Semiconductor giant Intel has hired veteran semiconductor lipbutane as its new CEO. The news comes three months after Pat Gelsinger retired and resigned from the company’s board of directors, with Intel CFO David Zinsner and executive vice president of client relations Michelle Johnston Holthaus intervening in the co-CEOS.
Tan, CEO of Cadence Design Systems, joined Intel at an interesting time in the history of the Silicon Valley Company and is rejoining the board. Intel has seen a good portion of its ups and downs over the past few years.
When Gelsinger took the helm in February 2021, Intel was already struggling and was far behind its peers in the semiconductor races. At the time, the company thought that in addition to missteps when it came to chip manufacturing, it was likely that it hadn’t missed the smartphone revolution.
It was also an interesting time for the semiconductor industry as a whole. The sector has seen recent consolidation in the second half of 2020, with AMD getting Xilink for $35 billion and including analog purchase sayings such as $21 billion.
So, what was Gelsinger’s latest tenure at Inter? Let’s take a look.
Gelsinger was perfect for working when he started. He announced a modernization plan for the company called IDM, or an integrated device manufacturing. The first part of the goal was a $20 billion investment to build two new chip manufacturing facilities in Arizona, with plans to boost chip production in the US and beyond.
In 2022, the company announced the second part of this IDM plan. This includes three approaches to chip manufacturing: Intel’s Fabs, a third-party global manufacturer, and building the company’s casting services. As part of the plan, the company announced it would acquire Tower Semiconductor for $5.4 billion to help build Intel’s custom foundry services.
But the deal collapsed after facing regulatory hurdles. It was cancelled in the summer of 2023. At the time, TechCrunch reported that a merger that had not yet been merged would have a serious impact on the company’s modernization plans. In September 2024, Intel took steps to migrate Chip Foundry Division’s Intel Foundry into an independent subsidiary.
The time leading up to Gelsinger’s retirement was particularly turbulent for Inter. The company’s stock price plunged roughly 50% from the beginning of 2024 until Gelsinger’s departure in December. Intel announced 15% of the workforce (plan to fire around 15,000 people) in August after boring second quarter results. At the time, Gelsinger said the company had struggled to capitalize on the AI boom as its rivals had, and despite falling behind, Intel had overgrown personnel.
Since Gelsinger’s departure, the company has decided to delay the opening of Ohio Chip Factory again and not bring the Falcon Shores AI chip to the market.
But when Tan leads, things may be heading in the right direction. Intel has concluded its contract with the US Department of Commerce and received a $7.865 billion grant for domestic semiconductor manufacturing through the US Chip and Science Act. Intel has already received a $2.2 billion grant, according to its fourth-quarter revenue call. The company was also able to notch the victory regarding the popularity of the ARC B580 graphics card.
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