Intel (NASDAQ:INTC) is evaluating a potential sale of its networking and edge division, as part of new CEO Lip-Bu Tan’s plan to streamline the company and concentrate on its core semiconductor segments, according to a Reuters report citing multiple sources close to the matter.

The unit, previously labeled NEX in Intel’s financials, may be divested as part of Tan’s broader effort to reduce complexity and prioritize Intel’s strengths in PC and data center chips. While internal discussions are still in preliminary stages, the company has reportedly been in contact with investment banks to identify an advisor for a potential transaction.

Although Intel has not formally initiated a sale process or approached any prospective buyers, the deliberations mark the latest step in Tan’s campaign to reverse the sprawling diversification strategy pursued by previous leadership. Intel’s aggressive expansion into new business areas – such as contract chip manufacturing – under former CEO Pat Gelsinger strained company resources and contributed to a loss of market share in its traditional strongholds.

Since assuming leadership in March, Tan has emphasized financial discipline and organizational focus. His first major move came in April with the sale of a controlling stake in Intel’s Altera FPGA division to private equity firm Silver Lake for $4.46 billion. That transaction, which involved the sale of a 51% share, had previously been expected to take the form of a public spinoff.

At the time, Tan stated the move was part of Intel’s commitment to narrowing its strategic focus, cutting costs, and reinforcing its balance sheet. Should Intel proceed with the divestiture of its networking and edge business, it would further solidify this pivot toward core chipmaking operations and away from ancillary technologies.

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