Strategic Realignment

Taiwan’s manufacturing sector is undergoing a significant shift, with AI server revenue now surpassing iPhone revenue for major players. This transition, occurring in just three years, sees companies like Foxconn strategically diversifying beyond consumer electronics. Taiwan dominates AI server manufacturing, accounting for over 90% of global builds. Production value surged in 2024, with companies like Wistron and Quanta experiencing substantial revenue growth. While this transformation benefits Taiwan’s tech industry, challenges remain, including potential market share erosion and the need for more distributed global operations.

Southwest Gas Holdings is reducing its stake in Centuri Holdings through a secondary public offering of 15 million shares at $19.50 each. Underwriters have an option to purchase an additional 2.25 million shares. Carl Icahn’s affiliates will acquire 1,573,500 shares in a concurrent private placement at the same price. J.P. Morgan, Wells Fargo Securities, BofA Securities, and Moelis & Company are lead book-running managers. The offering, expected to close on August 11th, marks Southwest Gas’s strategic realignment and could signal further changes in its Centuri investment.

Intel plans to spin off its Network and Edge (NEX) business unit, a division developing network and communication chips with $5.8 billion in revenue in 2024. This strategic realignment signifies a pullback from competing with Nvidia in the communication chip market. NEX, with thousands of employees globally, including 400 in Israel, will become an independent entity focused on silicon solutions for communications, networking, and Ethernet connectivity. The move signals Intel abandoning its pursuit of a vertically integrated offering of AI hardware and software, similar to Nvidia’s model with Mellanox.