Intel Said to Have Lost Sony's PlayStation 6 Chip Contract to AMD
Intel lost out on a contract to design and fabricate Sony's PlayStation 6 chip in 2022, which dealt a significant blow to its effort to build its fledgling contract manufacturing business, according to three sources with knowledge of the events.
The effort by Intel to win out over Advanced Micro Devices in a competitive bidding process to supply the design for the forthcoming PlayStation 6 chip and Taiwan Semiconductor Manufacturing Co as the contract manufacturer would have amounted to billions of dollars of revenue and fabricating thousands of silicon wafers a month, two sources said.
Intel and AMD were the final two contenders in the bidding process for the contract.
Winning the Sony PlayStation 6 chip design business would have been a victory for Intel's design segment and would have doubled as a win for the company's contract manufacturing effort, or foundry business, which was the centerpiece of Intel CEO Pat Gelsinger's turnaround plan.
Gelsinger announced plans for Intel to create a foundry unit in 2021 and formally launched it at an event in San Jose, California, in February of this year. The PlayStation chip deal originated in Intel's design segment, but would have been a boon to the financial performance of the foundry business after this year's separation.
Details of the discussions and how Intel missed out on the contract for Sony's as-yet-unannounced next-generation game console are reported here for the first time.
Typically, Sony consoles sell more than 100 million units across a half decade. For a chip designer, the console business delivers a lower profit than the gross margins of more than 50 percent for products like artificial intelligence chips, but nonetheless represents steady business that can profit from technology a company has already developed. Sony's business also could have helped boost Intel's contract manufacturing business, which now struggles to find big new clients.
A dispute over how much profit Intel stood to take from each chip
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