Intel's major restructuring plan includes spinning off its chip manufacturing business

Intel is spinning off its chipmaking business to offset billions in losses and falling stock prices. In an announcement Monday, Intel CEO Pat Gelsinger said the Intel Foundry will become an independent subsidiary with “clearer separation and independence” from Intel.

With the change, Intel Foundry will have its own operating board and report its financial results separately from Intel. Intel will also halt work on the factories it is building in Poland and Germany for two years “due to expected market demand.” However, the company will continue to work on its plants in Arizona, Oregon, New Mexico and Ohio.

In addition, Intel plans to sell part of its stake in Altera, the programmable chipmaker it acquired in 2015. The company will also reduce about two-thirds of its global real estate footprint. As part of this announcement, Intel said the Biden administration has awarded the company up to $3 billion in funding to manufacture chips for the U.S. military.

“As I said, this is Intel's most significant transformation in over four decades. We haven't attempted anything this significant since the shift from memory to microprocessors,” Gelsinger said. “We succeeded then – and we will seize this moment and make Intel stronger for decades to come.”