I was working for a different CPU company at the time but the thought was by doing this it would allow Intel to focus on the sales and marketing of the Atom and push x86 everywhere rather than have a mixed x86 / ARM marketing message.

https://en.wikipedia.org/wiki/XScale

On June 27, 2006, the sale of Intel's XScale PXA mobile processor assets was announced. Intel agreed to sell the XScale PXA business to Marvell Technology Group for an estimated $600 million in cash and the assumption of unspecified liabilities. The move was intended to permit Intel to focus its resources on its core x86 and server businesses.

And that's where Intel continually loses out on markets because the x86 cash firehose is too good.

The XScale sale gained them $600MM, but what did they lose by being shut out of the mobile processor market for the next decade onward?

There are 2 billion iPhones on the planet somewhere and not a single one has an Intel application processor.

TLDR: Intel had a foothold in embedded/realtime operating systems and let it go.

Wanna talk about XScale? Intel had an ARM license and then decided, out of the blue, to sell the product line off.

TLDR: Intel had a foothold in low-power ARM platforms and let it go.

I never went near an Edison board so I don't even address that one. And now they're doing RISC-V. Don't go near it.

So, your question is "what is the root cause of Intel not getting a foothold in (em)bedded"? The answer is Intel itself.

Yes, I know they contribute to LF and whatnot. The point is that staking your embedded development pipeline on Intel itself is something I would never do (again). And I worked with Zephyr post-Intel, it wasn't a great system. I hope it's improved since then.

Of course, that still means one would be wary of betting on them in areas that aren't already well established…

Perfectly summarizes the sibling commenta on ever ongoing divestments from embedded opportunities.