Without arguing the merits of the Altera investment or divestment, a common pattern for Intel seems to be a wild see-sawing between an aggressive and a defensive market posture - it’s a regular occurrence for Intel to announce a bold new venture to try to claim some new territory, and just as regular that they announce they’re halting that venture in the name of “consolidating” and “focusing on their core.” The consequence is that they never give new ventures time to actually succeed, so they just bleed money creating things they murder in the cradle, and nobody born before last Tuesday is investing in bothering to learn the new Intel thing because its expected lifespan is shorter than the average Google product.
Intel either needs to focus or they need to be bold (and I’d actually prefer they be bold - they’ve started down some cool paths over time), but what they really need is to make up their goddamn minds and stop panicking every other quarter that their “ten-year bets” from last quarter haven’t paid off yet.
Speaking from personal experience, many director-level and above positions at Intel, especially in growth related areas are filled through nepotism and professional connections. I've never seen a headline about Intel’s decline and thought, 'Wow, how could that happen?'
I had a business partner that I agreed on a lot of things with but not about Intel. My assumption was that any small software package from Intel, such as a graph processing toolkit, was trash. He thought they could do no wrong.
Intel really is good at certain kinds of software like compilers or MKL but my belief is that organizations like that have a belief in their "number oneness" that gets in their way of doing anything that it outside what they're good at. Maybe it is the people, processes, organization, values, etc. that gets in the way. Or maybe not having the flexibility to know that what is good at task A is not good at task B.
That’s not specific to Intel though. That’s how Directors and above are recruited in any big company.
For example, Uber hired a VP from Amazon. And the first thing he did was to hire most of his immediate reports at Amazon to Director/Senior Director positions at Uber.
At that level of management work gets done mostly through connections, favors and networking.
Major companies like that become infected with large hierarchies of scum sucking middle management that eat revenue with bonuses.
Of course they are obsessed with shrinking labor costs and resisting all downsizing until it reaches comical levels.
Take a company like health insurance that can't show a large dividend because it would be a public relations disaster. Filled to the gills with vice presidents to suck up extra earnings. Or medical devices.
Software is also very difficult for these hierarchies of overpaid management, because you need to pay labor well to get good software, and the only raison d'etre of these guys is wage suppression.
Leadership is hard for these managers because the primary thing rewarded is middle management machiavellianism, turf wars, and domain building, and any visionary leadership or inspiration is quashed.
It almost fascinates me that large company organizations basically are like Soviet style communism, Even though there are opportunities for internal competition. Like data centers and hosting and it groups. They always need to be centralized for" efficiency".
Meanwhile, they are like 20 data centers and if you had each of them compete for the company's internal business, they'd all run more efficiently.
> it’s a regular occurrence for Intel to announce a bold new venture to try to claim some new territory, and just as regular that they announce they’re halting that venture in the name of “consolidating” and “focusing on their core.” [...] [Intel's new thing's] expected lifespan is shorter than the average Google product.
You got there in the end. You get the same outcome with the same corporate incentive.
Both Intel and Google prioritize {starting something new} over {growing an existing thing}, in terms of corporate promotions and rewards, and therefore employees and leaders self-optimize to produce the repeated behavior you see.
The way to fix this would be to decrease the rewards for starting a new thing and increase the rewards for evolving and growing an existing line of business.
> Both Intel and Google prioritize {starting something new} over {growing an existing thing}, in terms of corporate promotions and rewards, and therefore employees and leaders self-optimize to produce the repeated behavior you see.
I cannot speak for Intel, but Google has done very well by "growing an existing thing" in AdWords and YouTube. Both account for the lion's share of profits. They are absolute revenue giants. Many have tried, and failed to chip away at that lead, but Google has managed to adapt over and over again.
It's similar to sales vs dev in software. Sales are always prioritizing new features to attract new users instead of fixing the known issues that are pissing off your current users.
New feature attracts new users and allows for fancy press releases. Nobody cares about press releases about an existing product getting a bug fix are become more stable.
Our society is nothing but "ooh look, shiny!" type of short attention span
But, well, it was a ten-year bet: Altera was acquired in 2015.
If they could not figure how to make it profitable, maybe somebody else should try. (Of course I don't think that the PE company is going to do just that.)
It was a ten-year bet, but they spent the first several years actively sabotaging Altera by trying to move their whole product stack over to non-functional Intel fabs.
Doesn't purchase by a PE company pretty much guarantee the death of it? At least the selling off of the most profitable parts and pieces? Has there ever been a story of a PE purchase and the company grew under the new owner?
This seems to be common for corporate America in general. I used to work at a YC startup. We kiiiiiinda maaaaaaaybe ran out of money (not my department) and happened to get bought by a large investor that also happens to be a US-based hardware manufacturer. Two years and countless reorgs later, they laid everyone off and as far as I know, are no longer in the business of selling the software products they bought. They never figured out how software worked, never had anyone managining the division for more than 6 months, and got bored. I think they thought by moving everyone over to Microsoft Word and Windows laptops (peppered with a half-hearted threat about RTO), they would just magically make billions of dollars the first month. It didn't happen.
I am beginning to think M&A are just some sort of ego thing for bored megacorp execs, rather than serious attempts to add efficiency and value to the marketplace. (Prove me wrong, bored megacorp execs. I'll wait.)
Having been through a few acquisitions myself, I think there is a perverse incentive where buying and destroying any competition (real or imagined) leads to positive enough outcomes that it doesn't matter if the underlying asset is destroyed. Nobody would come out and say that, but when an acquisition is tossed aside there may not be enough repercussions to prevent it from happening again.
My personal theory is that desktop / laptop / server x86 (usually) is such a giant money printer that a) Intel can invest in anything (Altera, antivirus, Optane...) but b) when they do, they quickly realise that this isn't a giant profit margin machine like x86, so why bother?
They fuck their customers when they do that. A good friend of mine had a product designed around Quark that was about to go into production when Intel pulled the rug out from under him.
I worked for a former Fortune 300 company that had an active internal investment strategy. They wanted the next billion dollar business, guaranteed, in 12 months. And wanted to invest more than 1 million dollars. Sadly they are now bankrupt and owned by PE.
Rest in Peace Altera I guess? I still drink out of my color changing Altera mug (that's long stopped changing color) most days. PE ruins everything so it's only a matter of time before they're gutted and sold for scraps by the vultures at Silver Lake. (though honestly the writing was on the wall since the Intel acquisition I had held onto some hope) If only we had a functioning government interested in actually maintaining our technological dominance and enforcing/expanding antitrust legislation. I wrote my first Verilog on an Altera chip and I'll remember them fondly.
Tariffs done well could be a boon for a sector. But they are tricky to do well, and the current administration doesn't show the slightest hint of being capable of doing it well.
You have to treat tariffs not as a moat to protect an industry for good, but a runway to give a nascent industry enough room to take off. In a mature industry, tariffs are more likely to keep incumbents uncompetitive and disincentivize investments that would make them more competitive, especially if those are capital-heavy.
Also, tariffs aren't going to be effective if other structural issues exist in an industry that prevent or sharply limit expansion. Like key components having a sole worldwide supplier with a full order book. Or if capital investment to set up a new factory are beyond the ability of the financial markets to provide.
I don't think people are opposed to tariffs, at least they weren't before. Bernie Sanders has historically been for tariffs when used properly. Used properly being the important phrase. When you have someone who doesn't understand what a trade deficit is imposing tariffs based on the difference between deficit and surplus, you pretty effectively turn people against tariffs on top of the whole destroying the global economy thing.
As someone who's worked at Xilinx before and after the merger, it's a surprise they were even able to sell it for that much. Altera has been noncompetitive to Xilinx in performance and to Lattice in terms of low-end/low-power offerings for at least the last 2 generations.
I'm concerned about the future of FPGAs and wonder who will lead the way to fix these abhorrent toolchains these FPGA companies force upon developers.
Yeah I personally wondered if AMD was just copying Intel, because apparently every CPU manufacturer also needs to manufacture FPGAs, or they actually have a long term strategy where it is essential for both the FPGA and CPU departments to cooperate.
I think Xilinx did a fine job with their AI Engines and AMD decided to integrate a machine learning focused variant on their laptops as a result. The design of the intel NPU is nowhere near as good as AMD's. I have to say that AMD is not a software company though and while the hardware is interesting, their software support is nonexistent.
Also, if you're worried about FPGAs that doesn't really make much sense, since Effinix is killing it.
I briefly hoped that, like the integration of GPUs, there would be a broader integration of programmable logic in general purpose CPUs, with AMD integrating Xilinx fabric and Intel integrating Altera fabric. But I could never imagine a real use case and apparently there wasn't a marketable enough one either. Something like high-level synthesis ending up like CUDA always seemed like it would present a neat development environment for certain optimizations.
Agree on both.
As things like the PIO on the rp line of micros gets more common, micros will have IO that can match FPGAs. For low end, micros are generally good enough or gain NPU compute cores. It’s the IO that differentiates FPGAs.
So Intel found optimists who think they can make Altera more competitive? It's a success. Success with Intel products would be better, and excellence at M&A is hard to convert into excellence at chipmaking, but it's better than nothing.
For those keeping score at home, 51% sold at a total valuation of $8.75B, which means they are bringing in around $4.5B, and recognizing a loss of roughly 50% on what was their biggest deal ever when it took place in 2015.
Sure, it was down 60%. But the real question is whether it outperformed Intel as a whole, and outperformed other internal investments Intel could make. I certainly wouldn't think that a 2015 dollar anywhere else within Intel is worth more than 40¢ today, given how they've been running.
Or they got what they wanted from it and are selling off the rest, like when Google bought Motorola Wireless for the Patents then sold off the non-googly employees, culture, and brand for cheap.
There was some hope at the time that FPGAs could be used in a lot more applications in the data center. It is likely still feasible. Remember Hennessy published:
And maybe this is/was a pipe dream - maybe there aren't enough people with the skills to have a "golden age of architecture". But MSFT was deploying FPGAs in the data center and there were certainly hopes and dreams this would become a big thing.
It made their stock pop for a while which was all that mattered to Brian Krzanich who took the bonus and left the mess in the hands of Bob Swan who did the same things and left the mess ... (recursion her).
> Intel soon discovered the obvious, which is that customers with applications well-suited to FPGAs already use FPGAs.
Yes, but pairing an FPGA somewhat tightly integrated with an actually powerful x86 CPU would have made an interesting alternative to the usual FPGA+some low end ARM combo that's common these days.
Sure, if they wanted to intel could have done what nvidia did with CUDA: Put the tech into everything, even their lowest end consumer devices, and sink hundreds of millions into tooling and developer education given away free of charge.
And maybe it would have lead somewhere. Perhaps. But they didn't.
Applications that benefit from the Zynq-style combination (e.g. radio systems) generally take that approach because they have SWaP concerns that preclude the use of big x86 CPUs in the first place.
It was a forced acquisition, iirc they made promises to Altera to get them to use their foundry, failed to keep those promises and could either get sued and embarrassed or just buy Altera outright for about what they were worth before the deal.
> Intel soon discovered the obvious, which is that customers with applications well-suited to FPGAs already use FPGAs.
So selling FPGA's was a bad move? Or was the purchase price just wildly out-of-line with the--checking...$9.8B annual market that's expected to rise to $23.3B by 2030?
I was excited, too. I was also excited when Intel announced Larrabee.
That was before I learnt about the many and varied ways in which Intel sabotages itself, and released that Intel's underperformance has little to do with a lack of good technical ideas or talent.
I.e. I was young and naive. I am now considerably less young, and at least a little less naive.
I used to work at Intel (around 1999) in their Jones Farm campus in Oregon. My employee stock grants from that time are still underwater.
This was the heyday at Intel. I left within a year because I noticed that the talent that was respected, compensated and influential at Intel was the sales engineers. I can't pretend to have known that would lead to the decline of the company, but I knew that as an engineer uninterested in sales, that it wasn't the place for me.
GPGPUs ended up becoming the AI/cloud accelerators that FPGAs promised to be back when Intel bought Altera.
FPGAs are not ideal for raw parallel number crunching like in AI/LLMs. They are more appropriate for predictable real-time/ultra-low-latency parallel things like the the modulation and demodulation of signals in 5G base state stations.
FPGAs might not be ideal, but AMD's NPU IP originated with Xilinx.
Intel was an early player to so many massive industries (e.g. XScale, GPGPU, hybrid FPGA SoCs). Intel abandoned all of them prematurely and has been left playing catch-up every time. We might be having a very different discussion if literally any of them had succeeded.
XScale was forced on Intel as a penalty for anticompetitive activities against Digital. It’s no surprise then that they weren’t interested in doing anything with it.
If only someone could have come up with a plausibly profitable use-case for advanced FPGA's and highly performant, efficient, real-time processing or hardware acceleration in those intervening years? What are ya gonna do?
Quick search shows Altera held 30% of the FPGA market. That puts AMD’s $50B acquisition of Xilinx (which holds ~50% of the market) in an awkward light. Using some extremely crude math, Xilinx’s fair market value might now be closer to ~$15B.
Did AMD massively overpay, or has the FPGA market fundamentally shifted? Curious to see how this new benchmark ripples into AMD’s stock valuation.
The FPGA market shifted. For a brief moment they were allowed to be on BOMs of end user devices due to the rest of the computing field lagging behind somewhat. That period, as far as I can tell, is over.
My anecdotal example would be high end broadcast audio processors. These do quite a bit beyond the actual processing of audio, in particular, into baseband or even RF signal generation.
In any case these devices used to be fully analog, then when they first went digital were a combination of DSPs for processing and FPGAs for signal output. Later generations dropped the DSP and did everything in larger FPGAs as the larger FPGAs became available. Later generations dropped the whole stack and just run on an 8 core Intel processor using real time linux and some specialized real time signal processing software with custom designed signal generators.
The high core and high frequency CPUs became good enough and getting custom made chips became exceptionally cheap as well. FPGAs became rather pointless in this pipline.
The US military, for a time, had a next generation radio specification that specifically called for the use of FPGAs, as that would allow them to make manufacturer agnostic radios and custom software for them. That never panned out but it shows the peak use of FPGAs to manage the constraints of this time period.
When Intel acquired Altera, Altera’s market share was at 36% and Xilinx at 51%. Today Xilinx remains at ~50% while Altera’s share has dropped to 29%. Altera has lost share to Microchip and Lattice.
I’ve said it before, Intel is where technology companies go to die. Fortunately while Altera is probably a mess of useless Intel drone MBAs, there’s a decent core that can be salvaged. Best of luck to them.
Apparently, the FPGA industry wasn't large enough for two major players. Maintaining an extremely specialized developer ecosystem for a relatively small niche can't have been cheap. Almost zero cross-over too, since FPGA tooling is much too foreign to be repurposed for other architectures. I suspect this move will make it a bit harder for Intel to collect "developer mindshare" for their other hyped up stuff because no one likes having the rug pulled out from under them. Hope AMD can make a better job with Xilinx than what Intel could with Altera.
Intel FPGA venture made tons more sense than AMD following it. FPGAs are great at filling up your idle fabs and honing engineering skills on reaching high yields.
Selling now also makes sense. There was only one serious competitor in 2015. Now you got Tariffs both ways to the main place where everything is build, and said place has own homegrown vendors like GOWIN, Sipeed, Efinix. But the biggest reason is amount of stuff designed in the West/Taiwan is falling with China taking over actual product design.
>In 2015, China released its “Made in China 2025” (MIC 2025) strategy, which refined some of these targets, setting a goal of achieving 40 percent self-sufficiency in semiconductors by 2020 and 70 percent by 2025.
>In 2024, the majority of MIC 2025's goals were considered to be achieved, despite U.S. efforts to curb the program.
Products coming out of China no longer use STM microcontrollers, Vishay/Analog mosfets/diodes and Altera/Xilinx FPGAs. Its all Chinese semiconductor brands you never heard about. Good example is this teardown of Deye SUN-5K-SG04LP1 5kW hybrid solar inverter https://www.youtube.com/watch?v=n0_cTg36A2Q
Intel was looking to sell Altera for over a year before Trump's Tariff Tourettes. And I bet it wasn't the hardware that was the problem, it was the software. No matter how amazing your FPGA hardware is, it is useless if you can't also produce high-quality software for operating it. For CPUs you can just tell people to use gcc or clang, not so with FPGAs.
Beyond ensuring adequate cash flow, they need to be 100% focused on getting 18A shipping in volume as soon as possible rather than financial engineering stuff.
My guess would be no, but I could be wrong. The current administration clearly wants more domestic capability, so even if someone like TSMC/Samsung/etc wanted to acquire as part of their US operations, my gut says it would be challenged.
When AMD spun off their fabs into what became Global Foundries, it was difficult for many to see the upside. However, today, it seems not being tied to any particular fab/tech is one of AMD's biggest advantages.
What a waste! I can never understand corporate thinking and how CEOs get such massive fucking pay for decisions like this.
Intel paid $16.7 billion in 2015 and sold it for $8.75 billion?! What about all the money dumped into Altera from 2015 to 2025? How much was that? Is Intel just handing over the FPGA market to AMD?
I'm not surprised by this divestiture - Investor confidence in Alterra has been low ever since the disastrous loss of their brand new capital ship Aurora on its very first mission.
That whole acquisition always was a head-scratcher to me. OK, you pay nearly 17B for the thing, and then do absolutely nothing with it. How does that work? Even during its best years 17B was big money for Intel.
I left the hardware business in 1992 but seems that nothing has changed. People still think FPGAs are really cool and nobody cab figure out how to make money selling them.
Seems quite cheap. If I was a state I'd buy it. Possibly give stake to the suitable university and then create internships and other learning opportunities. I would also subsidise products to SMEs and then invest more to ensure company can supply defence and other industries, decoupling the country from dependence on other countries from crucial tech.
I think nationalization is usually frowned on in the west, but your comment about universities got me wondering. It seems small enough that the state could donate it to a consortium of research universities. That'd have to be better than PE in terms of serving the national interest, wouldn't it?
The business geniuses of intel bought Altera for nearly $17B in 2015. Now sold control at valuation barely half of that. After official inflation of over 30% during that time. Which means it lost over 2/3 of its value, (take into account also the lost interest on that money). Given that they gave up control for half the money, it’s effectively as if it was relinquished for 1/3 of what Intel paid for it.
So far - no one of the responsible Intel execs paid any price for such atrocious loss of stakeholders’ value. They need to be in jail and lose their personal wealth to repay the stockholders.
The SEC should investigate them, see whether there was any inside trading to benefit from this horrible value loss.
This criminal lack of performance needs to be brought up during the upcoming shareholders meeting. Responsible must pay the price.
Would you hire again the Intel CEOs, head of Intel Capital, any members of Intel’s board of directors after such abysmal performance?
Without arguing the merits of the Altera investment or divestment, a common pattern for Intel seems to be a wild see-sawing between an aggressive and a defensive market posture - it’s a regular occurrence for Intel to announce a bold new venture to try to claim some new territory, and just as regular that they announce they’re halting that venture in the name of “consolidating” and “focusing on their core.” The consequence is that they never give new ventures time to actually succeed, so they just bleed money creating things they murder in the cradle, and nobody born before last Tuesday is investing in bothering to learn the new Intel thing because its expected lifespan is shorter than the average Google product.
Intel either needs to focus or they need to be bold (and I’d actually prefer they be bold - they’ve started down some cool paths over time), but what they really need is to make up their goddamn minds and stop panicking every other quarter that their “ten-year bets” from last quarter haven’t paid off yet.
Speaking from personal experience, many director-level and above positions at Intel, especially in growth related areas are filled through nepotism and professional connections. I've never seen a headline about Intel’s decline and thought, 'Wow, how could that happen?'
I had a business partner that I agreed on a lot of things with but not about Intel. My assumption was that any small software package from Intel, such as a graph processing toolkit, was trash. He thought they could do no wrong.
Intel really is good at certain kinds of software like compilers or MKL but my belief is that organizations like that have a belief in their "number oneness" that gets in their way of doing anything that it outside what they're good at. Maybe it is the people, processes, organization, values, etc. that gets in the way. Or maybe not having the flexibility to know that what is good at task A is not good at task B.
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That’s not specific to Intel though. That’s how Directors and above are recruited in any big company.
For example, Uber hired a VP from Amazon. And the first thing he did was to hire most of his immediate reports at Amazon to Director/Senior Director positions at Uber.
At that level of management work gets done mostly through connections, favors and networking.
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Major companies like that become infected with large hierarchies of scum sucking middle management that eat revenue with bonuses.
Of course they are obsessed with shrinking labor costs and resisting all downsizing until it reaches comical levels.
Take a company like health insurance that can't show a large dividend because it would be a public relations disaster. Filled to the gills with vice presidents to suck up extra earnings. Or medical devices.
Software is also very difficult for these hierarchies of overpaid management, because you need to pay labor well to get good software, and the only raison d'etre of these guys is wage suppression.
Leadership is hard for these managers because the primary thing rewarded is middle management machiavellianism, turf wars, and domain building, and any visionary leadership or inspiration is quashed.
It almost fascinates me that large company organizations basically are like Soviet style communism, Even though there are opportunities for internal competition. Like data centers and hosting and it groups. They always need to be centralized for" efficiency".
Meanwhile, they are like 20 data centers and if you had each of them compete for the company's internal business, they'd all run more efficiently.
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> it’s a regular occurrence for Intel to announce a bold new venture to try to claim some new territory, and just as regular that they announce they’re halting that venture in the name of “consolidating” and “focusing on their core.” [...] [Intel's new thing's] expected lifespan is shorter than the average Google product.
You got there in the end. You get the same outcome with the same corporate incentive.
Both Intel and Google prioritize {starting something new} over {growing an existing thing}, in terms of corporate promotions and rewards, and therefore employees and leaders self-optimize to produce the repeated behavior you see.
The way to fix this would be to decrease the rewards for starting a new thing and increase the rewards for evolving and growing an existing line of business.
I cannot speak for Intel, but Google has done very well by "growing an existing thing" in AdWords and YouTube. Both account for the lion's share of profits. They are absolute revenue giants. Many have tried, and failed to chip away at that lead, but Google has managed to adapt over and over again.
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It's similar to sales vs dev in software. Sales are always prioritizing new features to attract new users instead of fixing the known issues that are pissing off your current users.
New feature attracts new users and allows for fancy press releases. Nobody cares about press releases about an existing product getting a bug fix are become more stable.
Our society is nothing but "ooh look, shiny!" type of short attention span
But, well, it was a ten-year bet: Altera was acquired in 2015.
If they could not figure how to make it profitable, maybe somebody else should try. (Of course I don't think that the PE company is going to do just that.)
It was a ten-year bet, but they spent the first several years actively sabotaging Altera by trying to move their whole product stack over to non-functional Intel fabs.
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Doesn't purchase by a PE company pretty much guarantee the death of it? At least the selling off of the most profitable parts and pieces? Has there ever been a story of a PE purchase and the company grew under the new owner?
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M&A churn is a way for management to monetize their power. Efficacy is a distant second concern.
How does management benefit from M&As? Sorry if this is a basic question. Do executives get paid based on the number of acquisitions?
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This seems to be common for corporate America in general. I used to work at a YC startup. We kiiiiiinda maaaaaaaybe ran out of money (not my department) and happened to get bought by a large investor that also happens to be a US-based hardware manufacturer. Two years and countless reorgs later, they laid everyone off and as far as I know, are no longer in the business of selling the software products they bought. They never figured out how software worked, never had anyone managining the division for more than 6 months, and got bored. I think they thought by moving everyone over to Microsoft Word and Windows laptops (peppered with a half-hearted threat about RTO), they would just magically make billions of dollars the first month. It didn't happen.
I am beginning to think M&A are just some sort of ego thing for bored megacorp execs, rather than serious attempts to add efficiency and value to the marketplace. (Prove me wrong, bored megacorp execs. I'll wait.)
Having been through a few acquisitions myself, I think there is a perverse incentive where buying and destroying any competition (real or imagined) leads to positive enough outcomes that it doesn't matter if the underlying asset is destroyed. Nobody would come out and say that, but when an acquisition is tossed aside there may not be enough repercussions to prevent it from happening again.
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> I am beginning to think M&A are just some sort of ego thing for bored megacorp execs
It seems like a low risk effort to put a promising inexperienced exec in charge of a recent acquisition.
If they're a screw up and run it into the ground, imagine how much damage they could have done in a megacorp position of power.
Megacorp saved (at the cost of a smaller company)
Is Intel still a mega corporation? That seems to be the real problem for Intel. Becoming prey.
And Intel's acquisitions kill off promising startups. At least Altera is being sort of spun off instead of outright destroyed.
My personal theory is that desktop / laptop / server x86 (usually) is such a giant money printer that a) Intel can invest in anything (Altera, antivirus, Optane...) but b) when they do, they quickly realise that this isn't a giant profit margin machine like x86, so why bother?
They fuck their customers when they do that. A good friend of mine had a product designed around Quark that was about to go into production when Intel pulled the rug out from under him.
I worked for a former Fortune 300 company that had an active internal investment strategy. They wanted the next billion dollar business, guaranteed, in 12 months. And wanted to invest more than 1 million dollars. Sadly they are now bankrupt and owned by PE.
It could just be a stock play.. Need the stock to move up? Buy a company.
Stock down again? Sell the company you bought 2 years ago.
From the top to the bottom the problem with late stage capitalism is misaligned incentives.
Edit: I wrote "the problem" and I should have written "among the many, many problems"
Seems they should read Andy Grove’s books.
> a wild see-sawing between an aggressive and a defensive market posture
tick, tock
Rest in Peace Altera I guess? I still drink out of my color changing Altera mug (that's long stopped changing color) most days. PE ruins everything so it's only a matter of time before they're gutted and sold for scraps by the vultures at Silver Lake. (though honestly the writing was on the wall since the Intel acquisition I had held onto some hope) If only we had a functioning government interested in actually maintaining our technological dominance and enforcing/expanding antitrust legislation. I wrote my first Verilog on an Altera chip and I'll remember them fondly.
> [...] my color changing Altera mug (that's long stopped changing color) most days. PE ruins everything [...]
I don't think PE is responsible for that one.
I think your attention heads might not be reading the positional encoding quite right. :P
Mug? Well I got a Cubic Cyclonium- annoyingly no current tools support it and even the last version which did is no longer available.
https://datasheet.octopart.com/CUBIC-CYCLONIUM-Altera-datash...
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Tariffs done well could be a boon for a sector. But they are tricky to do well, and the current administration doesn't show the slightest hint of being capable of doing it well.
You have to treat tariffs not as a moat to protect an industry for good, but a runway to give a nascent industry enough room to take off. In a mature industry, tariffs are more likely to keep incumbents uncompetitive and disincentivize investments that would make them more competitive, especially if those are capital-heavy.
Also, tariffs aren't going to be effective if other structural issues exist in an industry that prevent or sharply limit expansion. Like key components having a sole worldwide supplier with a full order book. Or if capital investment to set up a new factory are beyond the ability of the financial markets to provide.
Yes a competent and forward-looking trade and industrial policy would be nice, as a treat.
I don't think people are opposed to tariffs, at least they weren't before. Bernie Sanders has historically been for tariffs when used properly. Used properly being the important phrase. When you have someone who doesn't understand what a trade deficit is imposing tariffs based on the difference between deficit and surplus, you pretty effectively turn people against tariffs on top of the whole destroying the global economy thing.
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This comment is textbook Poe's Law.
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As someone who's worked at Xilinx before and after the merger, it's a surprise they were even able to sell it for that much. Altera has been noncompetitive to Xilinx in performance and to Lattice in terms of low-end/low-power offerings for at least the last 2 generations.
I'm concerned about the future of FPGAs and wonder who will lead the way to fix these abhorrent toolchains these FPGA companies force upon developers.
>wonder who will lead the way to fix these abhorrent toolchains these FPGA companies force upon developers.
Some FPGA vendors are contributing to and relying, partially or completely, on the open source stack (mainly yosys+nextpnr).
It is still perceived as not being "as good" as the universally hated proprietary tools, but it's getting there.
This has piqued my interest, which vendors are using an open source stack?
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Yeah I personally wondered if AMD was just copying Intel, because apparently every CPU manufacturer also needs to manufacture FPGAs, or they actually have a long term strategy where it is essential for both the FPGA and CPU departments to cooperate.
I think Xilinx did a fine job with their AI Engines and AMD decided to integrate a machine learning focused variant on their laptops as a result. The design of the intel NPU is nowhere near as good as AMD's. I have to say that AMD is not a software company though and while the hardware is interesting, their software support is nonexistent.
Also, if you're worried about FPGAs that doesn't really make much sense, since Effinix is killing it.
I briefly hoped that, like the integration of GPUs, there would be a broader integration of programmable logic in general purpose CPUs, with AMD integrating Xilinx fabric and Intel integrating Altera fabric. But I could never imagine a real use case and apparently there wasn't a marketable enough one either. Something like high-level synthesis ending up like CUDA always seemed like it would present a neat development environment for certain optimizations.
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Agree on both. As things like the PIO on the rp line of micros gets more common, micros will have IO that can match FPGAs. For low end, micros are generally good enough or gain NPU compute cores. It’s the IO that differentiates FPGAs.
You worked at Xilinx and you're not aware that FPGA is not a growing segment?
What is replacing it? Single board computers? Or are APUs from ARM "good enough" and "cheap enough" now to replace FPGA?
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So Intel found optimists who think they can make Altera more competitive? It's a success. Success with Intel products would be better, and excellence at M&A is hard to convert into excellence at chipmaking, but it's better than nothing.
It seems FPGA can now do things for LLM's so there might be some future in that
https://www.achronix.com/blog/accelerating-llm-inferencing-f...
Its never going to be as efficient as ASIC and the LLM market is definitely big enough for ASICs to be viable.
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If LLM can leverage on the new efficient attention mechanism based the FFT architecture discovered by Google then FPGA can be the new hot stuff [1]:
[1] The FFT Strikes Back: An Efficient Alternative to Self-Attention (168 comments):
https://news.ycombinator.com/item?id=43182325
Alteras tools seemed more civilized than Xilinx's, in my limited experience.
Altera toolchain was a tad nicer than xilinx as of 2020, just saying. Still horrible, but at least the IDE wasn't a laggy Electron abomination.
For those keeping score at home, 51% sold at a total valuation of $8.75B, which means they are bringing in around $4.5B, and recognizing a loss of roughly 50% on what was their biggest deal ever when it took place in 2015.
"In December 2015, Intel acquired Altera for $16.7 billion in cash." $21.5 bn inflation adjusted. Amazing ten year performance.
Sure, it was down 60%. But the real question is whether it outperformed Intel as a whole, and outperformed other internal investments Intel could make. I certainly wouldn't think that a 2015 dollar anywhere else within Intel is worth more than 40¢ today, given how they've been running.
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Or they got what they wanted from it and are selling off the rest, like when Google bought Motorola Wireless for the Patents then sold off the non-googly employees, culture, and brand for cheap.
> sold off the non-googly employees
Ouch - your work is so good we will pay 10x what it is worth, because we are not good enough to do it.
But you are not good enough for us. Maybe they couldn't a binary tree.
It was a silly acquisition in the first place, and their justification clearly came from a coke-addled fever dream.
Intel soon discovered the obvious, which is that customers with applications well-suited to FPGAs already use FPGAs.
There was some hope at the time that FPGAs could be used in a lot more applications in the data center. It is likely still feasible. Remember Hennessy published:
https://www.doc.ic.ac.uk/~wl/teachlocal/arch/papers/cacm19go...
And maybe this is/was a pipe dream - maybe there aren't enough people with the skills to have a "golden age of architecture". But MSFT was deploying FPGAs in the data center and there were certainly hopes and dreams this would become a big thing.
That was certainly the dream, but unfortunately for them it didn't turn out to be a new market.
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It made their stock pop for a while which was all that mattered to Brian Krzanich who took the bonus and left the mess in the hands of Bob Swan who did the same things and left the mess ... (recursion her).
> Intel soon discovered the obvious, which is that customers with applications well-suited to FPGAs already use FPGAs.
Yes, but pairing an FPGA somewhat tightly integrated with an actually powerful x86 CPU would have made an interesting alternative to the usual FPGA+some low end ARM combo that's common these days.
Sure, if they wanted to intel could have done what nvidia did with CUDA: Put the tech into everything, even their lowest end consumer devices, and sink hundreds of millions into tooling and developer education given away free of charge.
And maybe it would have lead somewhere. Perhaps. But they didn't.
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Applications that benefit from the Zynq-style combination (e.g. radio systems) generally take that approach because they have SWaP concerns that preclude the use of big x86 CPUs in the first place.
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It was a forced acquisition, iirc they made promises to Altera to get them to use their foundry, failed to keep those promises and could either get sued and embarrassed or just buy Altera outright for about what they were worth before the deal.
> Intel soon discovered the obvious, which is that customers with applications well-suited to FPGAs already use FPGAs.
So selling FPGA's was a bad move? Or was the purchase price just wildly out-of-line with the--checking...$9.8B annual market that's expected to rise to $23.3B by 2030?
Intel can't even act as a functional foundry for internal customers.
Do you think AMD's decision to buy Xilinx was any better or not?
Perhaps we can say it was less of a distraction for AMD, given AMD is not having the basic execution issue that Intel is currently suffering.
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If AMD did the same thing years later, was it really that foolish?
Yes, because AMD is fabless, and Xilinx didn't suddenly have to figure out how to work around Intel's production problems.
Man I remember being excited when Intel bought Altera, maybe they'd bring FPGAs to the masses, then they proceeded to do nothing with them...
I was excited, too. I was also excited when Intel announced Larrabee.
That was before I learnt about the many and varied ways in which Intel sabotages itself, and released that Intel's underperformance has little to do with a lack of good technical ideas or talent.
I.e. I was young and naive. I am now considerably less young, and at least a little less naive.
I used to work at Intel (around 1999) in their Jones Farm campus in Oregon. My employee stock grants from that time are still underwater.
This was the heyday at Intel. I left within a year because I noticed that the talent that was respected, compensated and influential at Intel was the sales engineers. I can't pretend to have known that would lead to the decline of the company, but I knew that as an engineer uninterested in sales, that it wasn't the place for me.
I'd love to hear more about how the "sales engineers were the influential ones" manifested. I have an idea in my head, but I'm curious about details.
What would sales engineers be responsible for at a company like intel? I thought that was more of a SaaS thing.
GPGPUs ended up becoming the AI/cloud accelerators that FPGAs promised to be back when Intel bought Altera.
FPGAs are not ideal for raw parallel number crunching like in AI/LLMs. They are more appropriate for predictable real-time/ultra-low-latency parallel things like the the modulation and demodulation of signals in 5G base state stations.
FPGAs might not be ideal, but AMD's NPU IP originated with Xilinx.
Intel was an early player to so many massive industries (e.g. XScale, GPGPU, hybrid FPGA SoCs). Intel abandoned all of them prematurely and has been left playing catch-up every time. We might be having a very different discussion if literally any of them had succeeded.
XScale was forced on Intel as a penalty for anticompetitive activities against Digital. It’s no surprise then that they weren’t interested in doing anything with it.
Intel acquired Altera in December 2015 for $16.7 billion in cash.
If only someone could have come up with a plausibly profitable use-case for advanced FPGA's and highly performant, efficient, real-time processing or hardware acceleration in those intervening years? What are ya gonna do?
Well the thesis was DC accelerators but the world went with ASSPs.
Quick search shows Altera held 30% of the FPGA market. That puts AMD’s $50B acquisition of Xilinx (which holds ~50% of the market) in an awkward light. Using some extremely crude math, Xilinx’s fair market value might now be closer to ~$15B.
Did AMD massively overpay, or has the FPGA market fundamentally shifted? Curious to see how this new benchmark ripples into AMD’s stock valuation.
The FPGA market shifted. For a brief moment they were allowed to be on BOMs of end user devices due to the rest of the computing field lagging behind somewhat. That period, as far as I can tell, is over.
My anecdotal example would be high end broadcast audio processors. These do quite a bit beyond the actual processing of audio, in particular, into baseband or even RF signal generation.
In any case these devices used to be fully analog, then when they first went digital were a combination of DSPs for processing and FPGAs for signal output. Later generations dropped the DSP and did everything in larger FPGAs as the larger FPGAs became available. Later generations dropped the whole stack and just run on an 8 core Intel processor using real time linux and some specialized real time signal processing software with custom designed signal generators.
The high core and high frequency CPUs became good enough and getting custom made chips became exceptionally cheap as well. FPGAs became rather pointless in this pipline.
The US military, for a time, had a next generation radio specification that specifically called for the use of FPGAs, as that would allow them to make manufacturer agnostic radios and custom software for them. That never panned out but it shows the peak use of FPGAs to manage the constraints of this time period.
Not all market share are equal, like iphone vs. android. Also, the value for the leader will cost more than the second in line.
Should change title. They sold 51% at a valuation of $8.75B, so cash in is ~ $4.29B.
I've updated the title as best as I could within the constraints of the max length.
When Intel acquired Altera, Altera’s market share was at 36% and Xilinx at 51%. Today Xilinx remains at ~50% while Altera’s share has dropped to 29%. Altera has lost share to Microchip and Lattice.
I’ve said it before, Intel is where technology companies go to die. Fortunately while Altera is probably a mess of useless Intel drone MBAs, there’s a decent core that can be salvaged. Best of luck to them.
Props to Intel duping AMD to buy Xillix for whooping $50B
AMD bought an overpriced company with their own overpriced stock. Probably not as bad as it might look.
Apparently, the FPGA industry wasn't large enough for two major players. Maintaining an extremely specialized developer ecosystem for a relatively small niche can't have been cheap. Almost zero cross-over too, since FPGA tooling is much too foreign to be repurposed for other architectures. I suspect this move will make it a bit harder for Intel to collect "developer mindshare" for their other hyped up stuff because no one likes having the rug pulled out from under them. Hope AMD can make a better job with Xilinx than what Intel could with Altera.
Intel FPGA venture made tons more sense than AMD following it. FPGAs are great at filling up your idle fabs and honing engineering skills on reaching high yields.
Selling now also makes sense. There was only one serious competitor in 2015. Now you got Tariffs both ways to the main place where everything is build, and said place has own homegrown vendors like GOWIN, Sipeed, Efinix. But the biggest reason is amount of stuff designed in the West/Taiwan is falling with China taking over actual product design.
https://itif.org/publications/2024/08/19/how-innovative-is-c...
>In 2015, China released its “Made in China 2025” (MIC 2025) strategy, which refined some of these targets, setting a goal of achieving 40 percent self-sufficiency in semiconductors by 2020 and 70 percent by 2025.
https://en.wikipedia.org/wiki/Made_in_China_2025
>In 2024, the majority of MIC 2025's goals were considered to be achieved, despite U.S. efforts to curb the program.
Products coming out of China no longer use STM microcontrollers, Vishay/Analog mosfets/diodes and Altera/Xilinx FPGAs. Its all Chinese semiconductor brands you never heard about. Good example is this teardown of Deye SUN-5K-SG04LP1 5kW hybrid solar inverter https://www.youtube.com/watch?v=n0_cTg36A2Q
Intel was looking to sell Altera for over a year before Trump's Tariff Tourettes. And I bet it wasn't the hardware that was the problem, it was the software. No matter how amazing your FPGA hardware is, it is useless if you can't also produce high-quality software for operating it. For CPUs you can just tell people to use gcc or clang, not so with FPGAs.
I wonder if we'll see more Intel sell-offs, as Tan et al try to get things under control.
Will we see an AMD-esque fab spin-off?
Beyond ensuring adequate cash flow, they need to be 100% focused on getting 18A shipping in volume as soon as possible rather than financial engineering stuff.
Would market regulators allow a single buyer to acquire all of Intel's fabs in one go?
My guess would be no, but I could be wrong. The current administration clearly wants more domestic capability, so even if someone like TSMC/Samsung/etc wanted to acquire as part of their US operations, my gut says it would be challenged.
When AMD spun off their fabs into what became Global Foundries, it was difficult for many to see the upside. However, today, it seems not being tied to any particular fab/tech is one of AMD's biggest advantages.
I'd guess that they'll continue to sell off mobileye over time.
What a waste! I can never understand corporate thinking and how CEOs get such massive fucking pay for decisions like this.
Intel paid $16.7 billion in 2015 and sold it for $8.75 billion?! What about all the money dumped into Altera from 2015 to 2025? How much was that? Is Intel just handing over the FPGA market to AMD?
Right but they are only selling 51% of it.
https://download.intel.com/newsroom/2021/archive/2015-12-28-...
Maybe? But who cares. From all of the comments above, I learned that the FPGA market is stalled or shrinking. Even AMD likely overpaid for Xilinx.
I cannot help myself. My brain parks "Altera" right beside the Weyland and Jupiter Mining corps.
https://subnautica.fandom.com/wiki/Alterra_Corporation
I'm not surprised by this divestiture - Investor confidence in Alterra has been low ever since the disastrous loss of their brand new capital ship Aurora on its very first mission.
That whole acquisition always was a head-scratcher to me. OK, you pay nearly 17B for the thing, and then do absolutely nothing with it. How does that work? Even during its best years 17B was big money for Intel.
Leadership at Intel needs to go. They cannot be allowed to be C-level execs at any company.
Selling out to PE is a signal this company is about to get gutted and loaded to the tits with debt and management fees from PE.
Summary of the situation from The Register headline:
>Intel flogs off majority stake in Altera to private equity for $4B
>Buy high, sell low: FPGA biz cost x86 giant $16B decade ago
for those not up on this stuff
I left the hardware business in 1992 but seems that nothing has changed. People still think FPGAs are really cool and nobody cab figure out how to make money selling them.
Bravo, they managed to break even on their decade-old investment.
Should have stuffed it under the bed instead…
Was altera the thing they bought to do some really cool networking/switching/SDN stuff? Paging bcantrill.
You might be talking about Tofino?
That's the one.
You're thinking of Barefoot which is also dead. (And Fulcrum before that.)
Seems quite cheap. If I was a state I'd buy it. Possibly give stake to the suitable university and then create internships and other learning opportunities. I would also subsidise products to SMEs and then invest more to ensure company can supply defence and other industries, decoupling the country from dependence on other countries from crucial tech.
I mean it's a pipe dream, but why not.
I think nationalization is usually frowned on in the west, but your comment about universities got me wondering. It seems small enough that the state could donate it to a consortium of research universities. That'd have to be better than PE in terms of serving the national interest, wouldn't it?
Anyone who hoped Lunar Lake to buy Altera give thumbs up.
Looks like Intel is being stripped for parts.
Has everyone already forgotten about Optane, too?
Intel's problem is that they're trying to deliver short term shareholder value instead of long term stable value.
Not farfetched to think they’re maybe 6-8 quarters away from imploding. They need to survive.
That's a fair assessment. If they're not shipping 18A in volume early next year they likely will end up getting parted out later next year.
They'll give any market a good 18 months and then dip
The business geniuses of intel bought Altera for nearly $17B in 2015. Now sold control at valuation barely half of that. After official inflation of over 30% during that time. Which means it lost over 2/3 of its value, (take into account also the lost interest on that money). Given that they gave up control for half the money, it’s effectively as if it was relinquished for 1/3 of what Intel paid for it. So far - no one of the responsible Intel execs paid any price for such atrocious loss of stakeholders’ value. They need to be in jail and lose their personal wealth to repay the stockholders.
The SEC should investigate them, see whether there was any inside trading to benefit from this horrible value loss.
This criminal lack of performance needs to be brought up during the upcoming shareholders meeting. Responsible must pay the price.
Would you hire again the Intel CEOs, head of Intel Capital, any members of Intel’s board of directors after such abysmal performance?