Quick Read – Intel (INTC) sold its NAND memory business to SK Hynix in late 2021 for $9B, a decision that made sense then but now constrains the company as AI has transformed memory into a critical, supply-constrained component of chip infrastructure.
Meanwhile, memory suppliers like SK Hynix (000660.KS), Samsung, and Micron (MU) are benefiting from years-long AI-related memory backlogs. – The AI boom has converted memory from a cyclical commodity into a strategic necessity, leaving Intel dependent on external suppliers for components now essential to its foundry and CPU businesses despite government backing and momentum behind its turnaround. – The semiconductor industry has a funny way of changing the rules just when companies think they’ve figured them out
A few years ago, the hottest chip businesses were processors and foundries. Memory was viewed as a cyclical commodity business that could swing from shortages to gluts in a matter of quarters. Fast forward to 2026, and artificial intelligence has turned memory into one of the most valuable pieces of the AI supply chain.
That shift helps explain why Intel’s (NASDAQ:INTC) biggest strategic challenge today may stem from a decision it made nearly five years ago. Intel’s Stunning Turnaround Changed Everything Just a year ago, Intel looked like a company fighting for survival. Rivals including Broadcom (NASDAQ:AVGO), Taiwan Semiconductor Manufacturing (NYSE:TSM), Advanced Micro Devices (NASDAQ:AMD), and Nvidia (NASDAQ:NVDA) were reportedly exploring ways to acquire pieces of Intel’s business or potentially pursue larger transactions.