Intel has named Lip-Bu Tan as its new Chief Executive Officer, ushering in a leadership shift aimed at stabilizing the company after a turbulent period marked by financial setbacks, manufacturing delays, and mounting competitive pressure.
Tan’s appointment follows the resignation of former CEO Pat Gelsinger in December 2024, a departure that came amid intensifying scrutiny over Intel’s strategic direction and performance challenges.
Lip-Bu Tan, born on November 12, 1959, in Muar, Johor, Malaysia, holds a Master of Science in nuclear engineering from the Massachusetts Institute of Technology (MIT).
Following the 1979 Three Mile Island accident and the resulting decline in nuclear industry prospects, Tan shifted his focus and earned an MBA from the University of San Francisco. His career began with management roles at EDS Nuclear and ECHO Energy before he ventured into investment, founding the venture capital firm Walden International in 1987.
Tan’s leadership trajectory expanded when he joined Cadence Design Systems’ board of directors in 2004. He later became interim co-CEO in 2008 and assumed the full role of CEO in 2009, contributing to significant company growth, including the acquisition of Tensilica for $380 million in 2013.
Alongside his role at Cadence, Tan has held multiple board positions, including at Hewlett Packard Enterprise, Schneider Electric, and Softbank. Tan served as a member of the board of Intel from 2022 until 2024 when he stepped down from the board.
Leadership Transition and Strategic Realignment
Gelsinger’s exit closed a chapter defined by missed milestones and weakening investor confidence. In the interim, CFO David Zinsner and Intel Products head Michelle Johnston Holthaus shared leadership duties, with both now returning to their prior roles as Tan steps in to lead Intel through its next phase.
The leadership change reflects the board’s desire for renewed direction as the company faces stiff competition and operational disruptions.
Intel’s interim executive chairman Frank Yeary commented on the appointment, stating,
“Lip-Bu is an exceptional leader whose technology industry expertise, deep relationships across the product and foundry ecosystems, and proven track record of creating shareholder value is exactly what Intel needs in its next CEO. […] Throughout his long and distinguished career, he has earned a reputation as an innovator who puts customers at the heart of everything he does, delivers differentiated solutions to win in the market and builds high-performance cultures to achieve success.”
Lip-Bu Tan addressed Intel’s challenges in an email to all employees after his appointment, saying:
“As I prepare to come on board, I believe we have a truly unique opportunity to remake our company at one of the most pivotal moments in its history.
That’s not to say it will be easy. It won’t be. But I am joining because I believe with every fiber of my being that we have what it takes to win. Intel plays an essential role in the technology ecosystem, both in the U.S. and around the world. And, together, I’m confident we can turn our business around.” (Read the full statement at the end)
Mounting Financial Losses and Operational Challenges
Intel’s financial troubles intensified in 2024, with losses totaling $18.8 billion, including $13 billion stemming from its struggling foundry division. The company’s stock also reflected these difficulties, plunging by over 50% throughout the year.
Despite securing a $7.86 billion CHIPS Act grant aimed at strengthening U.S. semiconductor manufacturing, Intel’s capacity to deliver on these ambitions has been questioned.
Central to these concerns is the delayed completion of Intel’s $28 billion Ohio chip factory, a key initiative intended to bolster domestic semiconductor production. The project, initially projected for completion by the end of the decade, has now been postponed until 2030, raising doubts over Intel’s ability to fulfill its manufacturing goals and leverage government incentives effectively.
These delays not only jeopardize Intel’s own production strategy but also complicate broader efforts to strengthen the U.S. semiconductor supply chain. The factory’s postponement, despite substantial public investment, underscores ongoing structural challenges that Tan will need to address swiftly.
Product Strategy Realignment and AI Development Focus
Product development setbacks have further compounded Intel’s difficulties. The launch of its Arrow Lake processors in late 2024 was marred by early stability issues, impacting performance benchmarks for gaming and high-performance computing.
Intel responded with firmware updates in December 2024 and January 2025, aimed at resolving these problems and stabilizing the product line.. Despite these efforts, initial reception left lingering concerns about Intel’s capacity to meet consumer expectations.
In parallel, Intel has shifted its focus within the AI sector. The company cancelled its Falcon Shores AI chip project to prioritize the development of Jaguar Shores, a product aimed at delivering more efficient AI processing.
Its Gaudi AI accelerators—intended for machine learning applications like model training and inferencing—have faced challenges in matching competitors such as Nvidia in performance and market adoption.
At CES 2025, Intel introduced its Core Ultra Series 2 processors, designed to enhance AI capabilities for gaming and enterprise systems. The lineup reflects Intel’s broader effort to regain ground in AI-driven computing and better align its product strategy with evolving market demands.
Exploring Strategic Partnerships for Foundry Stability
In response to persistent manufacturing challenges, Intel is reportedly considering a joint venture with Taiwan Semiconductor Manufacturing Co. (TSMC). The proposed collaboration could involve U.S. chipmakers such as Nvidia, AMD, and Broadcom, with TSMC seeking a minority stake.
According to Reuters, TSMC has pitched these other chipmakers about taking stakes in a joint venture that would operate Intel’s factories
Any deal would require regulatory approval, though the partnership is seen as a way to stabilize Intel’s foundry operations while gaining access to TSMC’s advanced manufacturing processes.
Such a partnership would mark a notable shift for Intel, long known for its emphasis on in-house production. However, repeated delays and rising costs have forced a strategic reevaluation. This move could streamline Intel’s operations while alleviating financial pressures stemming from its recent losses.
Yet, reliance on external manufacturing partners introduces new strategic risks. The balance between leveraging external capacity and retaining manufacturing control will be a key issue for Intel’s long-term planning, especially as competitors accelerate their own production capabilities.
Restructuring for Efficiency and Cost Management
Intel’s operational challenges extend beyond manufacturing delays. In late 2024, the company announced a global workforce reduction of 15,000 employees, aiming to save $10 billion by the end of 2025.
This restructuring is part of broader efforts to simplify operations and improve financial resilience. However, Intel faces the challenge of balancing cost control with maintaining its product development and manufacturing capabilities.
The restructuring follows multiple internal setbacks, including delays in manufacturing schedules and underwhelming product launches. The company’s capacity to reduce operational costs without compromising innovation will be crucial to its long-term recovery strategy. If financial pressures persist, further cost-control measures may be necessary.
Market Reactions and Competitive Pressures
The market’s initial response to Tan’s appointment was cautiously optimistic. Intel’s stock saw a 13% uptick following the announcement, suggesting investor confidence in the leadership change.
However, analysts remain reserved, pointing to Intel’s prolonged challenges in keeping pace with competitors like Nvidia and AMD, especially in AI and advanced chip design.
Nvidia’s replacement of Intel on the Dow Jones Industrial Average in November 2024 highlighted Intel’s declining market influence and the broader shift towards AI-driven growth strategies. The move underscored Nvidia’s leadership in high-performance computing and AI, areas where Intel has struggled to maintain competitive momentum.
For Intel, regaining competitive strength will hinge on the successful implementation of its AI and manufacturing strategies. This includes demonstrating the reliability of its AI chips and improving its foundry services through potential external partnerships, such as the ongoing discussions with TSMC.
The Road Ahead: Navigating Uncertainty and Recovery
The coming year will be decisive for Intel. Under Tan’s leadership, the company will need to address persistent manufacturing inefficiencies, refine its AI product offerings, and stabilize financial performance through cost management. Strategic partnerships, particularly with companies like TSMC, could provide short-term stability but may also reshape Intel’s manufacturing philosophy.
How effectively Intel executes these strategies will determine its long-term prospects in a semiconductor market defined by rapid technological advances and intense competition. The company’s decisions over the next few quarters will be closely watched, with the industry gauging whether Intel can reclaim its status as a leading player or whether structural challenges will continue to impede its progress.
For now, Tan’s appointment is seen as a critical step toward redefining Intel’s strategy. Whether this leadership shift will be enough to restore the company’s fortunes remains to be seen, but it sets the stage for what could be one of the most consequential periods in Intel’s history.
Note From Lip-Bu Tan, Emailed to All Intel Employees on March 12, 2025:
Team,
I’m humbled and honored to be your next CEO.
Intel is a company I have long admired. Since I was a child, I have been captivated by the power of science, technology and engineering — and Intel’s innovation has been at the heart of so many world-changing breakthroughs along the way.
Of course, as we all know, past achievements do not predict future success, especially in an industry as dynamic as ours. The pace of change continues to accelerate, and the competition is intense. You understand this better than anyone, and I know it has been a tough few years for all of you and your teams.
One of the things you will learn about me is that I am never deterred by challenges. Throughout my career, they have motivated me to solve hard problems. As I prepare to come on board, I believe we have a truly unique opportunity to remake our company at one of the most pivotal moments in its history.
That’s not to say it will be easy. It won’t be. But I am joining because I believe with every fiber of my being that we have what it takes to win. Intel plays an essential role in the technology ecosystem, both in the U.S. and around the world. And, together, I’m confident we can turn our business around.
Under my leadership, Intel will be an engineering-focused company. We will push ourselves to develop the best products, listen intently to our customers and hold ourselves accountable to the commitments we make so that we build trust.
I subscribe to a simple philosophy: Stay humble. Work hard. Delight our customers. When you anchor yourself in those three core beliefs, good things happen. This has been true in every job I’ve ever had, and it’s the way I will approach the work ahead as your CEO.
We cannot take anything for granted, and we will do regular deep dives to assess our progress. In areas where we have momentum, we need to double down and extend our advantage. In areas where we are behind the competition, we need to take calculated risks to disrupt and leapfrog. And in areas where our progress has been slower than expected, we need to find new ways to pick up the pace.
Most importantly, we need to work as one team. One of the most enduring lessons I learned during my university days came as an athlete, not a student. I learned to believe in and trust my teammates, because I knew that was the surest path to victory — and there’s nothing I dislike more than losing. This is the mentality we all need to embrace as we build a winning culture across Intel.
Now more than ever, our customers are counting on us to pull together as a team and deliver for them. Above all else, that is and will remain our number one priority. And as your CEO, I will empower leaders to take ownership and actions to move our business forward.
We have a chance to do something special together. In many ways, we are the founders of “The New Intel.” We will learn from past mistakes, use setbacks to strengthen our resolve and choose action over distraction to reach our full potential.
Together, we will work hard to restore Intel’s position as a world-class products company, establish ourselves as a world-class foundry and delight our customers like never before. That’s what this moment demands of us as we remake Intel for the future.
We also have a responsibility to deliver for our shareholders — something I am equally focused on and expect will be an outcome of our renewed focus on customers.
I’m grateful for the trust the board has placed in me to lead this great company forward. I’m proud to be joining the team and excited about our work together.
Best,
Lip-Bu Tan
