Oops. They had a compelling business case behind this, which was to be a one-stop-shop for all the IP needed to make a SoC, similar to what ARM has long done. Even if their RISC-V cores weren't the most competitive, they merely needed to be decent, for a lot of embedded applications.
The only possible upside I can see to this is perhaps making themselves cheaper, in hopes of getting picked up as a GPU-provider by someone who already has custom RISC-V cores, like SiFive. However, I think SiFive is probably in no position to make such an acquisition.
Gosh, Imagination really does seem to be circling the drain, these days.