(Bloomberg)-The shares of Intel Corp jumped by 15 % after the company has appointed Lip-Bu Tan as an upcoming executive chairman, as it entrusted a former member of the Board of Directors and veteran warriors in semiconductors with one of the most difficult jobs in the chips industry.
Most of them read from Bloomberg
The company said in a statement on Wednesday that Tan, 65, will take over the role on March 18. It will also join the council after step down in August 2024.
Tan, former head of Cadence Design Systems Inc. It is charged with restoring the wealth of the pioneering chips maker who has become lagging behind the industry. Intel, which has controlled the semiconductor field for decades, is struggling with the loss of market participation, manufacturing refractions and a tremendous decline in its profits. It is also burdened with debt and recently had to reduce about 15,000 jobs.
The announcement sparked optimism from investors, who sent shares to $ 23.70 in New York on Thursday, representing the largest gain for one day within about a month. The Bank of America Corp analyzes also upgraded the stocks to “Neutral”, referring to “Solid Solid Register”. During Wednesday, the stock has decreased more than 50 % over the past 12 months, as the company’s future has become increasingly mysterious.
In a memo for Intel employees, Tan said he was confident that he was able to operate the work.
“This does not mean that it will be easy. He said,” It will not be. “But I join because I believe in all fibers that I have what we have to win. Intel plays an essential role in the ecosystem of technology, both in the United States or around the world. “
Tan, Gilgringer’s predecessor, by the Council, was removed by the council for a noticeable failure in renewing the Intel products. One of the most blatant challenges: Create an accelerated artificial intelligence slice that can compete with NVIDIA Corp. products. The company, once in ETEL, has witnessed its revenue and evaluation over the past two years due to the prosperity of intelligence computing.
“This is a good thing for Intel,” said Stacy Rachton, an analyst at Bernstein. “If you had to choose someone, the lips would have been at the top of that list.”
GELSINSAR also began to convert Intel into a chip -a chip -sliced muse – a contract manufacturer that manufactures products for external customers – but this effort is still in its early stages.
Tan indicated that he would continue this path. He said in the memo, which was published on the company’s website: “We will work hard to restore Intel as a global -level product company, and we create ourselves as world -class global precedents and the pleasure of our customers unprecedented.” “This is what this moment requires from us and we are reshaping the Intel for the future.”
Intel is still one of the world’s largest chips through revenues, exceeding $ 50 billion in annual sales. Its processors are the main ingredient in more than 70 % of the world’s personal computers and server machines in the world. The company’s factories still represent a large part of the global capacity for advanced manufacturing.
But slipping in the development of the product allowed the competitors to obtain an advantage. Besides Nvidia, Advanced Micro Devices Inc. won. The market share in computers and servers – it is more prepared than Intel to achieve pies in artificial intelligence chips. In light of these challenges, not at the top 10 chips industry companies all over the world according to the market value.
More: Big Take: How you lost Intel Edge (Podcast)
Tan, the Malaysian CEO, originated in Singapore, where he joined the University of Nenig and studied physics. He later went to the Massachusetts Institute of Technology, where he obtained a master’s degree in nuclear engineering. He abandoned his PhD in this field and left to San Francisco University, where he obtained a Master of Business Administration.
After working in investing in Venture, he joined the rhythm council in 2004. He became a participant in 2008 after Michael Vester left and then acquired this role in 2009. Tan managed the company for more than a decade before moving to the position of president, which he occupied until 2023.
Cadence, along with Synopsys Inc. , The market for design with the help of the computer used to create semiconductors. Their programs and services have become increasingly important with the high complexity of devices. Engineers use their products to create plans to arrange tens of billions of transistors and wires that bind them – the basic architecture of small components.
One day the Intel operation was the most famous position in this industry. At its peak, Intel profitability was unusually high for a manufacturer. Its total margin – the percentage of the remaining sales after deducting the production cost – north of 60 %. The standard is currently about half this level.
When Gelsiner took command in 2021, he was seen as a possible savior of the company. However, Wall Street tension on his plan turned after a series of disappointing quarterly results – including the August 2024 report described it as the worst in its history.
In 2024, Intel was largely the minimum performance in the semiconductor index on the Philadelphia Stock Exchange, where it decreased 60 %. With the company’s evaluation declining to the nineties levels, the idea that could not have been not previously could have been more logical.
The new Intel leader will have to move in the styles of the suitor and determine whether Geelsiner’s position will be that disintegration is unnecessary. Some have suggested at Wall Street to divide the company’s chips and manufacturing units, which are already separated from the operational point of view.
Bloomberg News reported that Qualcomm Inc. And Broadcom Inc. The Arm Holdings Plc has explored the idea of getting each or part of the Intel. If official methods are placed, the Intel panel will be under pressure to look at the scenarios that Geelsiner has rejected.
Separately, the Trump administration has approached its rival Taiwan semiconductors for manufacturing and its request to consider obtaining a stake in a group of Intel factories. Under this proposal, which Bloomberg News mentioned last month, TSMC will manage and re -configure plants to use its technology – something that may make it more attractive to external customers. Intel plants currently focus mainly on their own designs.
The plan also included trying to get the largest TSMC customer – a list that includes Qualcomm, AMD and Apple Inc. – To invest in Intel Spinoff. But this report followed him a week after TSMC announced at the White House that it would increase investments in its complex in Arizona. This indicates that it is preferable not to participate in external projects.
Santa Clara, Intel -based California is the largest scholarship from the United States government under the Law of Chips and Sciences, and is the Biden administration to stimulate the production of semiconductors.
The money law money, which total about $ 8 billion, depends on the completion of Intel, including the construction and provider of new factories throughout the United States. Intel has already delayed some of its construction plans, including a complex in Ohio. President Donald Trump also spoke against the program.
Interteen President Frank Uni said in a separate statement that Tan could benefit from his experience in re -invention of the rhythm. He said, “Tan has led a cultural shift focusing on the innovation centered around customers.”
“During his time as an executive head, the rhythm doubled more than twice his revenues, expanded operating margins and provided the stock price for more than 3200 %,” Yini said. “He also knows Intel well, as a partner when he was running the rhythm and recently served in our board of directors.”
If Tan is not able to organize a similar transformation in Intel, Bernstein said, “Perhaps it was impressive.”
-With the help of Subrat Patnaik.
(Updates with the movement of participation begins in the first paragraph.)
Most of them read from Bloomberg Business Week
© 2025 Bloomberg LP
