Intel sells stake in Arm, estimated to raise $147 million as part of business turnaround

Intel has sold its entire stake in Arm Holdings during the second quarter, the company's filing with the U.S. Securities and Exchange Commission revealed on Tuesday. The company also sold its stake in ZeroFox, a cybersecurity company, and reduced stake in Astera Labs, a developer of connectivity platforms for enterprise.

Intel generated some $147 million selling its stake in Arm Holdings, a relatively small sum for a company that posted a $1.6 billion loss for its second quarter . This move is part of Intel's ongoing effort to cut costs, which includes significant job cuts and expense reductions.

Intel's recent regulatory filing revealed that it no longer holds the 1.18 million shares of Arm it owned three months ago , as noticed by Bloomberg . The average price of Arm's stock during this period was $124.34 per share, leading to the estimated $147 million pay-out. The company also reduced stake in Astera Labs (which has always been seen as a strategic investment for Intel to ensure steady supply of things like PCIe retimers) and got rid of its stake in ZeroFox. Despite this, Intel reported a net loss of $120 million on its equity investments for the quarter.

Earlier this month, the company posted a dismal earnings report, which led to a nearly 33% drop in its stock value. Intel's struggles are compounded by the loss of unit and revenue market share to competitors , such as AMD, which uses the x86 instruction set architecture, and Apple, which uses the Arm ISA.

In response, Intel has announced plans to eliminate 15,000 jobs and cut other expenses to stabilize its financial position. Additionally, the company has suspended its dividend as part of these austerity measures.

Arm Holdings, majority-owned by Japan's SoftBank Group, is a key player in the semiconductor sector, which designs are found in the majority of smartphones and tablets. For Intel, an investment in Arm may be considered as a strategic one as the company is working with Arm on datacenter platforms optimized for its Intel 18A process technology. But Arm may be also interested in Intel as a potential licensee of its technologies as well as a partner of its other licensees.