Intel's Mobileye tests market support for high profile IPO

Mobileye, a self-driving unit, unveiled its initial public offering on Friday, testing support for a high profile stock debut even as the market for new issues has collapsed.

The tech IPO market is in the middle of its worst drought in nearly two decades. According to data from Dealogic, the U.S. listings have raised $7 billion so far this year. Traditional IPOs last year, excluding special purpose acquisition companies, had raised a record $154 billion.

If Mobileye's debut is received well, it may embolden other big names such as Instacart, Reddit and ServiceTitan, which have postponed their IPOs earlier this year until the market improves.

AIG Inc's life insurance and retirement division, Corebridge Financial Inc, raised $1.68 billion in the year's biggest IPO earlier in September, braving market volatility and ending a seven-month lull in major listings.

Mobileye, which was confidentially filed for its IPO earlier this year, reported first-half revenue of $854 million, a 21 per cent jump from the year-ago period, according to its IPO filing. In the year 2021, Mobileye posted $1.4 billion of revenue.

In April, Reuters reported that Mobileye had tapped Goldman Sachs Group Inc and Morgan Stanley to lead preparations for the self-driving car unit to go public.

In its filing on Friday, Mobileye confirmed Goldman Sachs and Morgan Stanley are the lead underwriters.

Mobileye plans to list shares on Nasdaq under the ticker MBLY. Mobileye hasn't set a price range for its IPO yet, but Reuters has reported that the company could target a valuation as high as $50 billion for its share sale.

A source familiar with the matter said on Friday that Mobileye may lower its IPO valuation estimate due to adverse market conditions.

Intel hasn't revealed the stake it will retain when it goes public, but the chip giant previously said it would be a majority interest.

The Moye listing is part of Intel's broader strategy under Chief Executive Pat Gelsinger to turn around its core business.

Mobileye, an Israeli company Intel bought for about $15.3 billion in 2017, uses a camera-based system with adaptive cruise control and lane change assistance in driverless cars.

Mobileye offers driver assistance technology and mapping technology that are currently in use today, in addition to self-driving chips and software.

Mobileye, which counts BMW, Audi, Volkswagen, Nissan, Honda and General Motors as its clients, has been a bright spot for Intel, which is facing stiff competition in chip-making from Nvidia Corp and Qualcomm Inc.