After almost 10 years of investments and flagging progress, Micron announced today (Tuesday) that it is ending its involvement in 3D XPoint, the non-volatile memory technology it originally developed in collaboration with Intel. As it ceases all R&D on 3D XPoint technology, the company said it is also shutting down and selling the Lehi, Utah, fab factory where the memory is manufactured.
In a statement released earlier today, Micron cited “insufficient market validation to justify the ongoing high levels of investments required to successfully commercialize 3D XPoint at scale.”
The company said it is shifting its investment into memory products that leverage Compute Express Link (CXL), an open interconnect standard that maintains CPU-device memory coherence. Its overall investment will remain constant, said Micron.
“The CXL interface opens up new paths for platform innovation and optimization in the datacenter,” Micron said. Citing ever-growing data demands and the proliferation of AI workloads, the company said it “sees immense promise in new classes of memory-centric solutions that utilize CXL to scale the capacity, performance and content required by applications to run on infrastructure with greater architectural freedom.”
“Our decision was driven by our assessment of the 3D XPoint market opportunity in light of the expected impact of CXL and our new emerging memory products, on the future datacenter,” said Micron’s President and Chief Executive Officer Sanjay Mehrotra on a conference call held for investors earlier today.
“On the storage front, the significantly lower cost of NAND will remain a barrier for wide adoption of 3D XPoint, Therefore, 3D XPoint-based SSD products are not expected to be anything more than a niche market over time. Memory was always the strategic long term market opportunity for 3D XPoint,” he added.
Another challenge Mehrotra cited is the software work that must be done to take advantage of 3D XPoint.
“The latency of access requires significant changes to datacenter applications to leverage the full benefits of 3D XPoint,” he said. “These changes are complex and extremely time-consuming, requiring years of sustained industrywide effort to drive broad adoption.”
Micron expects a higher ROI for the new investments it will be making. The company reported it was losing about $400 million a year on 3D XPoint.
Micron has put its Lehi fab that is currently dedicated to 3D XPoint production on the market. The company is “in discussions with several potential buyers,” said Mehrotra. “We expect that the overwhelming majority of our team members in Lehi will find strong career opportunities with the buyer of the fab,” he added.
Micron codeveloped 3D XPoint with Intel starting in 2012, but the Boise, Idaho-based company parted ways with the chip giant in 2019, after completing work on the second generation of memory. Intel launched its 3D XPoint-based Optane line in 2017, and Micron debuted its first 3D XPoint product, the X100 SSD, in October 2019. Only Intel has developed and commercialized 3D XPoint in a DIMM form factor with the Intel Persistent Memory Module, launched in 2019.
Micron originally planned to offer 3D XPoint-based SSDs and DIMMs under the brand “QuantX,” but it never shipped any products with that name.
The Lehi fab was at one time jointly owned by Micron and Intel, but Micron bought Intel out of their share in 2019. Market analyst Dan Olds of Intersect360 Research told HPCwire that while Micron supplied Intel with wafers to use in their Optane products, that hasn’t produced enough end user sales, assumedly, to make the product profitable.
“Reading between the tea leaves of the official announcement, the market just hasn’t embraced 3D XPoint to the degree that it makes sense for Micron to continue production and the partnership with Intel,” Olds said.
He added that while Micron is shopping its factory to several interested parties, “Intel [is] probably at the head of the list.”
Intel’s 3D XPoint supply chain is safe for the near-term as Micron promised on its investor call to support its existing customer base for “the next several quarters.”
“I think it’s a good move for Micron, and it’s inconsequential for Intel,” said Jim Handy, principal at Objective Analysis, citing the $400 million annual run rate the Lehi fab is incurring. “Micron has been moving at a reasonable pace, trying to extricate itself from 3D XPoint and cutting down its relationship with Intel, but honoring its commitments to ship the product to Intel.”
Intel has been making prototypes of advanced versions of 3D XPoint at its Rio Rancho, New Mexico, fab, and could turn that into a production facility, Handy told HPCwire.
“Intel could easily step up and be the high bidder [for Lehi], but if for some reason they decide not to do that, I expect they will use their Rio Rancho fab to fulfill all of their commitments,” Handy said. “Add if Intel doesn’t want Lehi for itself, then it’s very likely that fab will end up making something completely different from 3D XPoint.”
Asked to comment on Micron’s move, an Intel spokesperson told HPCwire that “Micron’s announcement doesn’t change our strategy for Intel Optane or our ability to supply Intel Optane products to our customers.”