Intel’s self-driving technology unit Mobileye finally made its debut on the Nasdaq stock exchange after many months of turbulence. Shares of Mobileye Global opened for trading at $26.71, after the company priced its initial public offering (IPO) at $21 late Tuesday.
Its shares later jumped by 30% in early afternoon trading on Wednesday, valuing the self-driving unit of Intel Corp at $21.8 billion, far lower than the $50 billion valuation Intel was targeting in its IPO back in March.
“The valuation probably wasn’t what we wanted it to be. But there was a lot of value in gaining that public company platform now,” Mobileye chief communications officer Dan Galves said on Wednesday. Mobileye had been listed on the New York Stock Exchange since 2014 before being acquired by Intel in a $15.3 billion deal in 2017.
As we reported back two years ago, the chipmaker giant invested $600 million in Israel to expand its research and development (R&D) and confirmed it was spending $10 billion on a new chip plant. As part of the $600 million investment, Intel also invested $400 million to turn its Mobileye unit headquartered in Jerusalem into an R&D campus for developing self-driving car technologies.
However, in recent years, the semiconductor giant has been trying to refocus its business around semiconductor production. Intel CEO Pat Gelsinger also promised to keep the company’s eye on the core business. As such, it didn’t come as a surprise after Intel decided to separate and decouple its self-driving car unit Mobileye from its semiconductor business.
Originally founded in 1999 in Israel by Amnon Shashua and Ziv Aviram, Mobileye is a self-driving tech startup developing vision-based advanced driver assistance systems that help prevent and mitigate collisions. Mobileye promises to help drivers take their eyes off the literal road.
In 2021 alone, Mobileye, which counts BMW, Audi, Volkswagen, Nissan, Honda, and General Motors as its clients, generated $1.4 billion in revenue 2021, a roughly 40% jump from 2020. Waymo and Cruise, the self-driving subsidiaries of Alphabet and GM respectively, have each been valued at roughly $30 billion despite generating virtually no revenue.
Mobileye plans to eventually build its own “lidar” sensor to help its cars map out a three-dimensional view of the road. It is currently using lidar units from Luminar Technologies on its initial robotaxis in the meantime.
