Intel’s decision to keep NEX signals stability for Israel’s 350 networking staff
Chipmaker reverses course on a potential spin-out as it bets on tighter integration across AI, data-center and edge products.
Intel has decided to retain its networking and communications division, NEX, concluding a months-long strategic review and offering rare stability to roughly 350 employees across its three Israeli development centers.
The unit, which in Israel is spread across Haifa, Petah Tikva and Jerusalem, had been under scrutiny as part of CEO Lip-Bu Tan’s broader effort to streamline the company and reshape its portfolio. Intel had explored selling various assets to improve its financial position and even examined a potential NEX spin-out earlier this year.
But following a surge of new capital, including an $8.9 billion U.S. government investment for a 10% stake, alongside $2 billion from SoftBank Group and $5 billion from Nvidia, Intel’s cash position has strengthened meaningfully. Finance chief Dave Zinsner said as much during the company’s third-quarter earnings release.
After completing its review, Intel said it had concluded that keeping NEX “would be beneficial,” explaining: “Keeping NEX in-house enables tighter integration between silicon, software and systems, strengthening customer offerings across AI, data center, and edge.”
NEX develops a portfolio of software and hardware technologies that sit at the heart of global communications infrastructure. These include Ethernet products, switches, silicon photonics, and processors
Globally, NEX employs several thousand people, with Israel serving as a significant R&D hub.
In its statement, Intel emphasized that NEX’s role is not peripheral but complementary to its broader product roadmap, particularly where the company seeks tighter coupling between chips, software layers and system-level solutions.
