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 1. Home
 2. News


INTEL KILLS OPTANE MEMORY BUSINESS, PAYS $559 MILLION INVENTORY WRITE-OFF

By Paul Alcorn published 7 days ago

3D XPoint at the last crossroad.

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Comments (30)

(Image credit: Lenovo)


Update 08/02/2022 12:30am PT: Intel reached out to clarify that it would bring
the next-gen Crow Pass Optane memory DIMMs to market and will use its existing
inventory to fulfill orders. This wasn't clear from Intel's previous statement
because this is technically a future product. We have clarified that point in
the below text. 



Original Article:

Intel's Q2 2022 earnings report today was uncharacteristically disappointing,
but it also hid a new announcement: Intel is winding down its Optane business
entirely. During the earnings call, Intel CEO Pat Gelsinger clarified the
vaguely worded announcement in the earnings documents, confirming that Intel
will wind down its Optane business. The move incurs a $559 million inventory
impairment/write-off. We reached out to Intel for comment on the matter: 

"We continue to rationalize our portfolio in support of our IDM 2.0 strategy.
This includes evaluating divesting businesses that are either not sufficiently
profitable or not core to our strategic objectives. After careful consideration,
Intel plans to cease future product development within its Optane business. We
are committed to supporting Optane customers through the transition."— Intel's
spokesperson to Tom's Hardware. [See additional commentary below for more
clarity]

Gelsinger said this marks the sixth non-core business Intel has sold since his
arrival, including the recent sale of its drone business to Elon Musk's brother
along with the sale of the SSD storage unit to SK hynix, generating $1.5 billion
for investment in areas that are core to Intel's business. 






(Image credit: Intel)

Intel used Optane memory to create both storage and memory products, and it has
long been rumored to be on the chopping block. At its debut in 2015, Intel and
partner Micron touted the underlying tech, 3D XPoint, as delivering 1000x the
performance and 1000x the endurance of NAND storage, and 10x the density of
DRAM.

Intel had already stopped producing its Optane storage products for client PCs,
which makes sense as it is at the beginning of a multi-year journey to sell its
NAND business to SK hynix. However, Intel originally retained its memory
business for the data center, including its persistent memory DIMMs that can
function as an adjunct to main memory — a capability only Intel offered. Now
those products will also not see any future generations after the next-gen Crow
Pass modules that will arrive with the Sapphire Rapids processors. 

RECOMMENDED VIDEOS FOR YOU... Tom's Hardware




Gelsinger cited an industry shift to CXL-based architectures as a reason for
winding down the Optane business, mirroring Intel's ex-partner Micron's
sentiments when it exited the business last year. Micron was the sole
high-volume fabricator of 3D XPoint, the memory Intel uses to make Optane, and
the company later sold its 3D XPoint fab to Texas Instruments, leaving Intel
with no production facilities of its own.

Industry watchers reported that Intel was serving existing Optane customers from
its inventory that it amassed from Micron before the fab was closed, but that it
wasn't actively fabricating the memory. Intel reportedly had several years of
inventory on hand, perhaps helping explain the magnitude of the $559 million
write-off.

Interestingly, we saw the initial tests of Intel's next-gen DDR5 Optane memory
modules, codenamed Crow's Pass, emerge just last week. These DDR5 modules are
planned to debut with Intel's oft-delayed Sapphire Rapids chips later this
year. 



Intel's David Tuhy, Vice President and General Manager of the Intel Optane
Group, reached out to clarify that the company will still bring the Crow Pass
modules to market and that the company will use its existing inventory to
fulfill orders. Intel will also continue to sell its other existing Optane data
center products and predicts that, based on its current forecasts, it has
several years' worth of inventory. However, the company will not develop any
further generations, instead now taking a $559 inventory write-off. 




Paul Alcorn
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Deputy Managing Editor

Paul Alcorn is the Deputy Managing Editor for Tom's Hardware US. He writes news
and reviews on CPUs, storage and enterprise hardware.




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See all comments (30)


30 Comments Comment from the forums
 * USAFRet
   Good.
   Reply
 * cirdecus
   This is a shame. Optane runs client apps and games far better than anything
   today and at extreme reliability. I'm using the 1.5TB drive for steam games
   and windows apps and i love it. That being said, I know they're looking to
   focus on their chip business and as NAND improves, the cost for the
   technology just can't keep...
   Read More Reply
 * maestro0428
   Damn right its a shame. Optane drives are the fastest on the planet and will
   be for some time. They also last for ever (tons of writes) and noone can
   match it. I have four in my workstation and love em. Mine (900p) arent the
   fastest at sequential reads and writes but still dominate benches in
   everyplace that actually...
   Read More Reply
 * jeremyj_83
   > maestro0428 said:
   > Damn right its a shame. Optane drives are the fastest on the planet and
   > will be for some time. They also last for ever (tons of writes) and noone
   > can match it. I have four in my workstation and love em. Mine (900p) arent
   > the fastest at sequential reads and writes but still dominate benches in
   > everyplace...
   
   Read More Reply
 * LikeClockwork64
   Some poor IT guy is going to get fired because its going to take a day
   instead of an hour to troubleshoot someone's business
   Reply
 * we_are_theBorg
   Shouldn't that subtitle be:
   
   "3D XPoint at the last Xroad."🤔
   
   But seriously, it's a shame. I only ever used it seriously in one system but
   it was incredibly useful when you really needed that memory density, or an
   intermediate caching layer with extremely durable writes. It's failure kinda
   psychologically entrenches NAND just that much deeper and disincentivises...
   Read More Reply
 * escksu
   Oh, been a long time. Optane is not bad but its simply way too expensive. It
   ended up as a product which is neither here nor there.
   
   Unlike Optane, NAND is making leaps and bounds in terms of progress. This is
   mainly due to a very competitive market and massive demand for NAND.
   Reply
 * 2Be_or_Not2Be
   > jeremyj_83 said:
   > This was Optane memory and not Optane SSD.
   
   
   I feel the irony in how Intel wants now to get back more local
   manufacturing/fabrication, but they let a local one of their own creation go
   previously. It's still a shame to me that they left Optane storage first,
   which was its best performer - more so than Optane...
   Read More Reply
 * Kamen Rider Blade
   Intel making bone head moves again.
   
   They should license the Optane technology to ALL the competing memory
   manufacturers and let them innovate on it.
   
   Just like Intel contributing ThunderBolt Interface to USB IF.
   
   Intel trying to make this "Proprietary", kills off very good technology by
   being too expensive to sustain or innovate on.
   
   Damn, such...
   Read More Reply
 * slash3
   > jeremyj_83 said:
   > This was Optane memory and not Optane SSD.
   
   
   Ryan Smith over at AnandTech has since confirmed with Intel that it is in
   fact Optane in its entirety that is being discontinued.
   
   https://www.anandtech.com/show/17515/intel-to-wind-down-optane-memory-business
   "Update: 6:40pm ET
   Following our request, Intel has sent out a short statement on the Optane
   wind-down. While not offering much in the way...
   Read More Reply
 * View All 30 Comments

Show more comments

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