Bloomberg this week took a deep dive into how Intel CEO Lip Vu Tan is trying to save one of Silicon Valley’s most storied but struggling chipmakers. It’s worth a read, but it doesn’t actually fully capture the most surprising part of the story. Intel’s stock price has increased an astounding 490% over the past year, a bet by Wall Street that the company may be further along than the company’s actual turnaround.
Mr. Tan, who took over last March, reportedly spent much of his first year chatting rather than reorganizing, striking a sweetheart deal with the U.S. government (now Intel’s third-largest shareholder), courting Elon Musk in a factory partnership, and inking preliminary manufacturing deals with both Apple and Tesla.
The basics are still confusing. Intel’s chip yields have lagged far behind industry leader TSMC, and employees told Bloomberg that Tan has downplayed details internally and that some teams are adjusting to missed deadlines rather than making up for them.
But investors are betting big on the bigger picture. Whether the death penalty will be carried out is a multibillion-dollar question.
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