Intel has announced its new CEO in the wake of Pat Gelsinger's retirement, naming former board member Lip-Bu Tan as its new leader months after he quit – reportedly over frustrations on the direction the struggling chip maker was taking.
Gelsinger took the reins at Intel in 2001 after departing in 2009, after a 30-year stint at the company that culminated in the CTO role. Gelsinger said he would step down amid reports he was being forced out in December, with David Zinsner and Michelle ‘MJ’ Johnston Holthaus named as interim co-CEOs.
The past few years have been tough for Intel, with the firm placed on the back foot in AI thanks to the dominance of Nvidia. Last year, Intel reported a net loss of more than $18 billion and announced cuts to 15% of its workforce.
Tan previously held a position on Intel's board of directors, but stepped down in August last year. Tan will now take the reins on 18 March. Intel's shares climbed 10% on the news of his appointment.
"I am honored to join Intel as CEO," Tan said in a statement. "I have tremendous respect and admiration for this iconic company, and I see significant opportunities to remake our business in ways that serve our customers better and create value for our shareholders."
Who is Lip-Bu Tan?
Tan was born in Malaysia and studied at Nanyang Technological University in Singapore, before picking up a masters degree in nuclear engineering and an MBA from the University of San Francisco.
A long-time investor in technology via his investment firm, Walden, Tan has funded a wide range of semiconductor and technology businesses in Asia and the US. In 2001, Forbes called him "the pioneer of Asian VC".
Tan also served as CEO of Cadence Design Systems from 2009 to 2021, an Intel supplier.
In its statement confirming his appointment, Intel noted that while leading Cadence, Tan reinvented the company and refocused on "customer centric innovation", with Cadence's revenue more than doubling and stock prices surging 3,200% during his tenure.
Tan has also sat on the boards of HPE and SoftBank, among others, and was appointed to Intel's board in 2022, later taking on oversight of manufacturing operations, according to Reuters.
Tan received the 2002 Robert N. Noyce Award from the Semiconductor Industry Association, with SIA president John Neuffer calling Tan "a true technology visionary".
Executive chair Frank D. Yeary said Tan had a proven track record in the chip industry, making him well placed to lead the chip maker as it plans to drive competition with industry counterparts such as AMD and Nvidia.
"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," Yeary said in a statement.
"Like many across the industry, I have worked closely with Lip-Bu in the past and have seen firsthand how his relentless attention to customers drives innovation and success," Yeary added.
"We are delighted to have Lip-Bu as our CEO as we work to accelerate our turnaround and capitalize on the significant growth opportunities ahead."
Intel's woes
Tan has plenty of work ahead of him. Though Intel still maintains a strong market share in laptops and PCs, its market share has shrunk amidst fierce competition with AMD. That's been worsened by Intel missing the shift to mobile, and then AI.
While the AI boom has sparked huge demand for chips, Intel has struggled to remain relevant as Nvidia's GPUs dominated that industry and other rivals out-innovated the one time market leader.
The company has struggled for a decade or more, with delays to process improvements that have now largely been pinned on underinvestment. Gelsinger was brought in to get Intel back on track in 2021, eventually announcing a business model shift that would see it manufacture other companies' chips for the first time, offering an alternative to Taiwan's TSMC.
But last year, Intel admitted billions in losses and announced it would cut 15,000 roles, some 15% of its workforce. Months later, reports suggested Gelsinger was pushed out — told to quit or be removed.
"Intel has a powerful and differentiated computing platform, a vast customer installed base and a robust manufacturing footprint that is getting stronger by the day as we rebuild our process technology roadmap," Tan said in a statement.
"I am eager to join the company and build upon the work the entire Intel team has been doing to position our business for the future."
Takeover rumors
Tan said in a letter to Intel employees, seen by Reuters, that he didn't plan to break up the company by splitting its design and manufacturing businesses.
This comes amid reports that a group of chip companies including TSMC, Nvidia, AMD, and Broadcom are seeking to takeover Intel's manufacturing division.
"Intel plays an essential role in the technology ecosystem, both in the US and around the world. And, together, I’m confident we can turn our business around," Tan reportedly said.
The report suggested that TSMC had pitched the idea of taking stakes in a joint venture that would take over and operate Intel's factories. The Taiwanese chip giant would take no more than a 50% stake. The talks are said to be in the early stages.
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