Intel reportedly lost to AMD in the bid to design and fabricate processors for the upcoming Sony PlayStation 6 (PS6).
According to Reuters, Intel and AMD were the final contenders in the PS6 chip design and fabrication tender.
Reportedly, Intel’s loss dealt a significant blow to the aspirations of its IFS contract manufacturing business, now known as Intel Foundry. The contract, estimated to be worth around USD30 billion in revenue, will instead goes to AMD.
Reuters sources indicate that Intel and its foundries division were competing against AMD and TSMC for the PS6 chip contract in 2022. The chip design and manufacturing rivals, who were the last contenders after Broadcom was sidelined, vied for a deal valued at up to USD30 billion (~RM127 billion). Winning this contract would have been a major boost for Intel, especially its fledgling IFS division.
Intel’s hesitation over profit margins reportedly led to the victory of Sony’s current processor design partner. Reuters sources mention that Intel clashed with Sony over the profit margin per chip supplied.
However, with Sony selling massive volumes of game consoles, sometimes over 100 million per generation, smaller margins are typically accepted. Suppliers generally value the steady, reliable income over several years and are usually willing to accept smaller margins. In Intel’s case, getting its foundry business up and running should have been an additional consideration.
An Intel spokesperson has responded to the Reuters report, stating they “strongly disagree with this characterisation,” but declined to comment further on customer discussions. AMD and Sony have not responded to this news.
Sony is not expected to launch the PS6 until at least 2027, and based on this news, Sony’s next-gen console will continue to use AMD’s processor architectures.