Intel is making a bold push into ASIC and design services, signaling its next major bet in the race for AI and custom silicon. According to CEO Lip-Bu Tan, the new effort won’t be a side project—it’s set to become a core pillar of the company’s strategy, transforming Intel’s foundry into a true end-to-end platform for building purpose-built chips.
At the heart of this pivot is the newly formed Central Engineering Group, a division created to bring Intel’s engineering talent under one roof and speed up execution. Led by Srini Iyengar, who joined from Cadence in July, the group is tasked with building out Intel’s ASIC and design service business. The goal: deliver custom silicon that ranges from general-purpose designs to highly specialized, fixed-function hardware for external customers.
This move comes at a critical time. Intel doesn’t currently have a broad AI product lineup that can go head-to-head with rivals, and its next major AI accelerator family—Jaguar Shores, a rack-scale platform—isn’t expected until 2027. Meanwhile, competitors have carved out strong positions with well-defined AI hardware portfolios. That’s where ASICs and design services could change the game for Intel.
Intel brings a rare combination to the table: deep silicon expertise, valuable x86 IP, advanced packaging, and its own internal foundry. For companies chasing custom AI chips, that means a genuine one-stop shop—from architecture and IP to manufacturing and assembly—something most ASIC designers can’t offer. Even established players in custom silicon design don’t control the full stack the way Intel does, and consolidating horizontal engineering through the CEG significantly reduces friction between design teams and manufacturing.
There’s substantial revenue potential in the middle of the AI supply chain, from design fees to volume-based manufacturing margins. Lip-Bu Tan’s background aligns perfectly with this direction. His experience guiding custom silicon ecosystems—emphasizing IP, design tools, partnerships, and vertical market solutions—positions Intel to scale quickly in a market that’s moving fast toward specialized compute.
If Intel executes, the company could evolve into a system foundry that owns every step of the custom chip journey. That would make Intel an increasingly compelling partner for hyperscalers, cloud providers, and enterprises exploring tailored AI silicon. Still, this is a tough climb. The AI market is fiercely competitive, customer timelines are tight, and established ASIC designers continue to advance their offerings. Success will hinge on Intel’s ability to deliver competitive process nodes, tight integration across design and manufacturing, and consistent time-to-market.
The takeaway: Intel’s ASIC and design services strategy could become its new bread and butter, bridging today’s AI gap while laying the foundation for long-term leadership in custom silicon. The pieces are in place—now it’s a question of execution.
