Intel Optane: Phase change memory division with huge loss

The 3D XPoint phase-change memory may be faster than corresponding NAND counterparts, but it still has a niche existence due to the immense costs. This caused a gigantic loss of $576 million for Intel’s Optane division for 2020.

Intel Optane at a loss of over half a billion dollars

Intel’s Optane SSD series is currently one of the fastest storage solutions on the market. Optane SSDs realize their outstanding speed primarily due to the 3D XPoint phase-change memory developed together with Micron, which enables faster and more consistent speeds than is the case with classic NAND flash, especially under permanent load.

It has not yet been possible to earn money with it, also due to the enormously high costs. That’s according to Intel’s annual report for 2020, which it sent to the Securities and Exchange Commission.

The report shows that Intel’s Non-Volatile Memory Storage Group (NSG) generated $1.1 billion less in revenue in 2021 than it did in 2020, primarily due to a $712 million drop in selling prices resulting from increased market weakness and pricing pressure.

Another $392 million in revenue from the Optane division was missing due to the outsourcing and the Data Center Group (DCG) responsible for it. Operating income had benefited from the transfer to NSG, but the Optane divisions still suffered a $576 million loss in 2020.

Intel Optane on the brink of extinction?

Since the summer of 2021, the entire manufacturing process of 3D XPoint is solely in the hands of Intel, which Micron dropped out due to the high losses. However, in view of the high losses, the future of the fast phase memory stands on extremely shaky legs.

At least there will soon be two new storage solutions with the In January leaked Optane SSDs Intel P5810X and P5811X. The Intel P5810X uses a 2.5-inch form factor complete with U.2 connector, while the Intel P5811X uses the current Enterprise & Datacenter Storage Form Factor (EDSFF) E1.S used in server SSDs. Maybe the last of its kind?