Intel, a struggling chipmaker, has announced the appointment of Lip-Bu Tan as its new CEO, effective March 18. This decision comes after the company ousted its long-time leader, Pat Gelsinger, more than three months ago.
Tan, a seasoned technology investor with over 20 years of experience in the industry, has been considered a potential candidate for the CEO position for some time. In December, Intel’s board approached him to gauge his interest in taking on the role, as reported by Reuters.
Following the news of Tan’s appointment, Intel’s shares surged by 12% in extended trading. Analysts have welcomed this move, noting that it is likely to bring stability to the chipmaker, whose stock had declined by 60% in 2024.
Bob O’Donnell, chief analyst at TECHnalysis Research, commented that Tan is a great fit for the role. He highlighted Tan’s expertise in both chip manufacturing and design, as well as his extensive industry connections. Prior to joining Intel, Tan served as the CEO of Cadence Design Systems, a supplier of chip-design software.
Intel is currently undergoing a significant transition as it seeks to recover from a challenging period. The company is striving to capitalize on the growing demand for advanced AI chips while also investing heavily in becoming a contract manufacturer for other companies. However, some investors have expressed concerns about the potential impact on Intel’s cash flows.
In a letter to Intel employees, Tan expressed his commitment to restoring the company’s position as a leading products provider and establishing itself as a premier foundry. This suggests that he aims to maintain the integration of chip design and manufacturing operations at Intel.
Reports have also surfaced indicating that Taiwan Semiconductor Manufacturing has approached some of Intel’s key manufacturing customers about forming a joint venture to operate Intel’s factories.
Tan’s return to Intel, after leaving the board last year due to differences in strategy, has been met with optimism by industry experts. Anshel Sag, principal analyst at Moor Insights & Strategy, believes that Tan’s appointment will bring stability and experience to the company, allowing it to focus on developing its foundry and product offerings.
Overall, Tan’s appointment as CEO of Intel marks a new chapter for the chipmaker as it navigates through a period of transformation and seeks to regain its competitive edge in the industry.
