Sony's PlayStation 6 console to use AMD chip, not Intel

Intel's failure to win the bid for Sony's PlayStation 6 (PS6) chip in 2022 dealt a significant blow to its effort to build its fledgling contract manufacturing business, sources with knowledge of the events told Reuters.

Sony relies on experienced design contractors to make its system processors. The current generation of Sony's consoles are powered by custom chips from AMD.

Sony consoles typically sell more than 100 million units across a half-decade. The business could have pumped roughly $30 billion into Intel's contract manufacturing business, which now struggles to find big new clients it can publicly talk about.

According to two sources, a dispute over how much profit Intel stood to take from each chip sold to the Japanese electronics giant blocked Intel from settling on the price with Sony.

Having missed the first wave of the AI boom dominated by Nvidia and AMD, Intel reported a disastrous second quarter in August. Intel announced plans to cut 15 percent of its workforce to save $10 billion and reportedly plans to reduce its capital spending on factory expansion, once a cornerstone of its foundry strategy.

In response to Reuters reporting about the PlayStation 6 talks and Intel's failure to win the business, an Intel spokesperson said, "We strongly disagree with this characterization but are not going to comment about any current or potential customer conversations. We have a very healthy customer pipeline across both our product and foundry business, and we are squarely focused on innovating to meet their needs."

Sony and Broadcom did not respond to requests for comment. AMD declined to comment.

(With input from Reuters.)