TLDR
- Lip-Bu Tan appointed as Intel’s new CEO, with stock jumping 13% in premarket trading
- Tan previously led Cadence Design Systems and served on Intel’s board before leaving in 2024
- Intel faces steep competition from TSMC in manufacturing and Nvidia in AI chips
- President Trump’s opposition to the CHIPS Act threatens Intel’s planned factory investments
- Tan plans to continue Intel’s current structure rather than splitting manufacturing and design businesses
Intel has named chip industry veteran Lip-Bu Tan as its new chief executive officer, sending the company’s shares soaring by 13% in premarket trading. The announcement comes as the once-dominant semiconductor giant battles to remain relevant in an industry now led by its rivals.
Tan steps into the role following the departure of former CEO Pat Gelsinger, who was ousted by Intel’s board in late 2024. He replaces interim co-CEOs David Zinsner and Michelle Johnston Holthaus.
The appointment brings to Intel a leader with deep semiconductor industry experience. Tan previously served as CEO of Cadence Design Systems for 11 years, where he successfully turned around the chip design tool company.
Tan already has history with Intel. He briefly served on the company’s board starting in 2022 but departed in August 2024. Reports indicate he left after disagreeing with Gelsinger about Intel’s turnaround strategy.
“I have tremendous respect and admiration for this iconic company,” Tan said in a statement announcing his appointment. “I see opportunities to remake our business in ways that serve our customers better and create value for our shareholders.”
Wall Street analysts have reacted positively to the news. Stifel analyst Ruben Roy noted Tan’s “transformative impact” at Cadence and described him as “uniquely qualified to attempt a reboot of Intel.”
The new CEO faces enormous challenges. Intel has watched its manufacturing leadership position crumble as Taiwan Semiconductor Manufacturing Company (TSMC) advanced more quickly to smaller, more efficient chip designs.
At the same time, Intel missed the artificial intelligence revolution that propelled Nvidia to become the world’s most valuable chip company. Nvidia now boasts a market value of $2.8 trillion compared to Intel’s mere $89 billion.
Stock Price
Intel’s stock has plummeted 54% over the past year as revenue shrank from pandemic highs. The company now faces renewed threats from longtime rival AMD and from Qualcomm’s push into the PC chip market.
Tan’s job is made even more difficult by political headwinds. The Trump administration has campaigned against the CHIPS Act, which would provide Intel with up to $8.5 billion in funding for new U.S. factories.
President Trump has indicated he prefers using tariff threats rather than direct funding to encourage semiconductor manufacturing in America. He claims this approach convinced TSMC to commit $100 billion of investment in the U.S.
Adding to the intrigue, Reuters reported that a consortium led by TSMC and including Nvidia and Broadcom is in talks to take over Intel’s manufacturing business. This news broke the same day as Tan’s appointment was announced.
Despite these reports, Tan told Intel employees he plans to continue with existing efforts to make Intel a leading contract chipmaker. This indicates he won’t split the company’s design and manufacturing operations.
Intel has already received billions via the CHIPS Act for new U.S. manufacturing facilities. However, its massive Ohio campus project has been delayed and won’t be completed until 2030, five years later than initially planned.
Some industry observers question whether any CEO, regardless of talent, can fully restore Intel to its former glory. The company must somehow compete with TSMC in manufacturing while simultaneously catching up to Nvidia in AI chips.
