Intel (INTC.US) announced it has decided against spinning off or selling shares of its network division after evaluation, concluding that retaining the unit as an internal business segment offers greater potential for success.

"Following a comprehensive assessment of strategic options for the Network and Edge (NEX) division—including potential independent operations—we determined that keeping the business within Intel best supports its growth," the company stated in an email on Wednesday. "Integrating NEX internally enables deeper synergy across chips, software, and systems, enhancing our customer solutions in AI, data centers, and edge computing."

A company spokesperson added that Intel has terminated negotiations with Ericsson (ERIC.US), which had previously explored acquiring a stake in NEX. Earlier this year, Intel disclosed plans to spin off the network division and seek strategic investors.

This strategic shift reflects the evolving transformation agenda under CEO Pat Gelsinger, who took office in March and has prioritized operational optimization through layoffs and divesting non-core assets. Ericsson declined to comment.

Intel has seen significant capital inflows since summer. In an unconventional deal facilitated by the Trump administration, the U.S. government acquired a 10% stake in the chipmaker in August. Additionally, Intel secured $2 billion from SoftBank Group (SFTBY.US) and $5 billion from NVIDIA (NVDA.US). These developments have propelled Intel’s stock to more than double this year.

Earlier, Ericsson considered investing to sustain Intel’s operations, as the Swedish telecom equipment maker relies on Intel’s chips for its mobile network hardware. The partnership deepened last year when Ericsson announced plans to adopt Intel’s next-gen Xeon processors for improved speed and energy efficiency.

Intel has lagged behind rivals like TSMC (TSM.US) and Samsung Electronics (SSNLF.US) in recent years. Former CEO Pat Gelsinger departed last year after his costly foundry transformation plan failed to deliver quick results. Since then, Intel has aggressively cut costs and explored selling non-core assets, including the now-abandoned NEX spin-off plan.