As Intel welcomes a new CEO, a look at where the company stands

Semiconductor large Intel employed semiconductor veteran Lip-Bu Tan to be its new CEO. This information comes three months after Pat Gelsinger retired and stepped down from the corporate’s board, with Intel CFO David Zinsner and government vp of consumer relations Michelle Johnston Holthaus stepping in as co-CEOs.

Tan, who was most not too long ago the CEO of Cadence Design Techniques, is becoming a member of Intel — and rejoining the board — at an attention-grabbing time within the Silicon Valley firm’s historical past. Intel has seen its fair proportion of ups and downs prior to now few years — to place it mildly.

When Gelsinger took the helm in February 2021, Intel was already struggling and was falling far behind its friends within the semiconductor race. On the time, the corporate was seemingly nonetheless reeling from missing out on the smartphone revolution along with missteps when it got here to chip fabrication.

It was additionally an attention-grabbing time for the semiconductor trade at giant. The sector had seen quite a lot of current consolidation in late 2020, together with AMD acquiring Xilink for $35 billion and Analog buying Maxim for $21 billion, amongst others.

So how was Gelsinger’s most up-to-date tenure at Intel? Let’s have a look.

Gelsinger acquired proper to work when he began. He introduced a modernization plan for the corporate, dubbed IDM, or built-in gadget manufacturing. The primary a part of the aim was a $20 billion funding to construct two new chip manufacturing amenities in Arizona, with plans to spice up chip manufacturing within the U.S. and past.

In 2022, the corporate introduced the second a part of this IDM plan, which concerned a three-pronged method to chip manufacturing: Intel’s fabs, third-party international producers, and constructing out the corporate’s foundry companies. As a part of this plan, the corporate introduced it might acquire Tower Semiconductor for $5.4 billion to assist construct out Intel’s customized foundry companies.

That deal fell by way of, nevertheless, after dealing with regulatory hurdles. It was canceled in the summertime of 2023. On the time, TechCrunch reported that the merger not going by way of would have a severe affect on the corporate’s modernization plans. In September 2024, Intel took steps to transition its chip foundry division, Intel Foundry, to an unbiased subsidiary.

The time main as much as Gelsinger’s retirement was significantly tumultuous for Intel. The corporate’s inventory worth plummeted about 50% from the start of 2024 to Gelsinger’s departure in December. Intel introduced plans to lay off 15% of its workforce, round 15,000 folks, in August after dismal second-quarter outcomes. At the moment, Gelsinger stated the corporate had struggled to capitalize on the AI increase in the identical manner its rivals had, and that regardless of falling behind, Intel had overgrown headcount.

Within the time since Gelsinger’s departure, the corporate has delayed the opening of its Ohio chip factory — once more — and determined to not deliver its Falcon Shores AI chips to market.

However as Tan takes the lead, issues could also be beginning to head in the suitable path. Intel finalized a cope with the U.S. Division of Commerce to obtain a $7.865 billion grant for home semiconductor manufacturing by way of the U.S. Chips and Science Act; Intel has already acquired $2.2 billion of that grant money, in line with its fourth-quarter earnings name. The corporate was additionally capable of notch a win relating to the recognition of its Arc B580 graphics card, which offered out after positive early reviews.