Intel's New CEO Lip-Bu Tan
AsianFin -- Intel has named a new chief executive as the semiconductor giant seeks to recover from a series of setbacks that have seen the once-dominant industry leader fall behind its competitors.
The company on Wednesday announced that Lip-Bu Tan, a veteran tech investor of Chinese descent and semiconductor industry executive, will take over from interim co-CEOs David Zinsner and Michelle Johnston Holthaus. They succeeded former CEO Pat Gelsinger, who was ousted by Intel's board of directors in late 2024.
Following the announcement, Intel's stock surged more than 11% in after-hours trading. However, as of Wednesday's market close, the company's shares had plummeted more than 54% over the past year, reflecting investors' growing concerns about Intel's future.
"In areas where we have momentum, we need to double down and extend our advantage," Tan said in statement. "In areas where we are behind the competition, we need to take calculated risks to disrupt and leapfrog. And in areas where our progress has been slower than expected, we need to find ways to pick up the pace."
Tan becomes the fourth permanent CEO at Intel in seven years. Following Brian Krzanich's resignation in 2018, Bob Swan took over in January 2019. He departed two years later after Intel suffered numerous blows from competitors and chip delays. Swan was succeeded by Gelsinger in 2021.
Gelsinger assumed leadership with an ambitious strategy to reshape Intel by expanding into chip manufacturing for other companies, positioning the company as a major foundry. However, Intel's overall product revenue continued to decline, and investors grew concerned about the substantial capital investments required for large-scale chip production, including the construction of a $20 billion factory complex in Ohio.
Tan brings a wealth of experience to the role. He previously helmed Cadence Design Systems for over a decade, where he spearheaded a significant transformation of the company. During his tenure as CEO, Cadence's revenue more than doubled, its operating profit margin improved, and its share price increased by more than 3,200%. From 2021 to 2023, Tan served as the Executive Chairman of Cadence.
He is also a founding managing partner of Walden Catalyst Ventures, a firm that invests in semiconductor, artificial intelligence, cloud computing, and other advanced technologies. He has rich experience in the boards of listed companies and currently serves as a member of the boards of Credo Technology Group, a high-speed connectivity solutions provider, and Schneider Electric.
Tan, 65, was born in Malaysia and spent his formative years in Singapore before relocating to the United States. He earned a bachelor's degree in physics from Singapore's Nanyang Technological University, and a master's degree in nuclear engineering from the Massachusetts Institute of Technology. He also holds an MBA from the University of San Francisco. In 2022, Tan was honored with the Robert Noyce Award, the semiconductor industry's most prestigious accolade.
"Lip-Bu is an exceptional leader whose deep expertise in the technology industry, extensive relationships across product and foundry ecosystems, and proven ability to create shareholder value make him the ideal choice to lead Intel forward," said Frank Yeary, Intel's interim executive chair, in a statement. Yeary will return to his role as the board's independent chair when Tan assumes the CEO position on March 18.
Tan faces a daunting challenge as he takes the helm of Intel, which has largely missed out on key technological shifts, including the mobile computing and AI revolutions, allowing rivals like Qualcomm and Nvidia to seize dominance. In recent months, speculation about a potential takeover has swirled as Intel's future has appeared increasingly uncertain.
The new CEO will also be under pressure to outperform his predecessor, Gelsinger, a company veteran who was hailed as a savior when he took over in 2021 but ultimately failed to reverse Intel's decline. Under Gelsinger's leadership, Intel announced plans in August to cut 15% of its workforce as part of a broader effort to reduce costs by $10 billion. In November, the company was removed from the Dow Jones Industrial Average after a 25-year tenure, replaced by Nvidia.
Intel's struggles come at a critical time for the U.S. semiconductor industry. Former U.S. President Joe Biden and incumbent President Donald Trump have prioritized bolstering chip manufacturing. Advanced semiconductors power everything from smartphones and AI systems to military equipment and medical devices, making them a cornerstone of modern technology.
In a sign of the growing competition, Taiwan Semiconductor Manufacturing Company (TSMC) recently announced plans to invest at least $100 billion to expand its operations in the United States.
In 2014, Tan proposed that the IC industry had entered the era of "large system design" –a complete system design that fully supports chips requires a comprehensive technology portfolio, ranging from chip design to PCB board design and then to software and hardware verification at the system level. This product design concept has now become the common understanding of leading EDA tool suppliers such as Cadence and Synopsys.
As Intel starts to turn around under the new leadership, the company's ability to regain its footing in the rapidly evolving semiconductor landscape will be closely watched by investors, industry peers, and policymakers alike. Tan's appointment marks a pivotal moment for Intel, as it seeks to reclaim its position as a leader in the global tech industry.
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