Intel Boss Vows To Fix Years Of Bureaucracy And Mismanagement
Intel CEO Lip-Bu Tan is addressing years of bureaucracy and mismanagement to refocus the company on engineering excellence, particularly in AI and its foundry division. Despite a 97% stock gain this year, analysts warn of competitive challenges from AMD and Arm Holdings, and predict Intel may remain unprofitable through 2027 without significant breakthroughs. Tan's strategy has garnered political attention, leading to a U.S. government investment in Intel to bolster domestic manufacturing.
Intel Corp (NASDAQ:INTC) CEO Lip-Bu Tan said he is working to refocus the company on engineering excellence after years of complacency and mismanagement weakened its leadership in the semiconductor industry.
Speaking at the Future Investment Initiative in Riyadh, Tan, who joined Intel in March, said he found “too many layers of management” slowing decision-making and innovation, Bloomberg reported on Tuesday.
Tan has concentrated Intel’s strategy on artificial intelligence and the company’s foundry division, which manufactures chips but still trails major rivals like Taiwan Semiconductor Manufacturing Co. (NYSE:TSM).
Also Read: Intel Unveils New Processors To Power AI, Gaming Devices
Political Backdrop and Government Investment
His tenure has already drawn political attention.
President Donald Trump initially called for Tan’s resignation due to his past investments in China, but later reversed course after a meeting with the CEO.
Tan explained that he had moved his Chinese holdings, made while living in Singapore, into a charitable trust.
After hearing Intel’s new strategy, Trump approved a U.S. government investment for a 10% stake in Intel, part of Washington’s effort to rebuild domestic manufacturing in critical industries.
Intel stock gained over 97% year-to-date, topping the Nasdaq 100 index’s (which includes Intel) 23% returns.
Analyst Commentary: Competitive Hurdles Remain
However, Bank of America Securities analyst Vivek Arya warned that Intel continues to face steep competitive and strategic challenges despite recent market optimism.
He said Intel is losing market share to Advanced Micro Devices, Inc. (NASDAQ:AMD) and Arm Holdings plc (NASDAQ:ARM) across PCs and servers.
At the same time, its limited integration with AI accelerators, even with Nvidia Corp (NASDAQ:NVDA) as a partner, reflects its lag in the fast-growing AI market.
He noted that the chipmaker’s $80 billion rise in market capitalization reflects financial strength and foundry potential, rather than real progress in product execution.
Arya expects Intel to remain unprofitable through 2027 without major external foundry wins or a breakout CPU refresh.
Price Action: INTC stock was trading higher by 0.18% to $39.61 premarket at last check Tuesday.
- Taiwan Semiconductor’s Foundational Role Signals It May Be Undervalued Versus Nvidia, Analyst Says
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