When Lip-Bu Tan became the CEO of Intel last year, it was clear that a lot was going to change at the company. Now, details of these changes are beginning to emerge. We already know that Lip-Bu Tan personally assesses and approves chip designs before tape outs, but as it turns out, he also wants designs to be bug-free and ready for mass production already with the A0 revision, something that the company's products have failed to do.

"One thing about timetable, I have a culture right now I have just implemented. It has to be A0 to production," said Lip-Bu Tan at JP Morgan's Global Technology, Media and Communications Conference. "A0 is when you tape out, first time pass. Intel does not have that culture, so I tell that, first time pass A0. B0, you keep your job. Anything above that, you are fired."

"So that culture people initially thought that I'm just joking, and now I started to implement, they started to say that, 'Okay, Lip-Bu, you are very serious, you really look into all the design, all the bugs that we've tried to fix, and then all the IP that we use. You make sure that we certify and make sure we do that before we go to tape-out,' and so those are kind of the culture we need to have," Tan said.

A0 is the very first manufactured version of a chip produced after the initial tape out and before any silicon fixes are implemented. First-pass success means that the chip boots, functions correctly, meets major specifications, no major redesign is needed, and the silicon is close to production quality (or of production quality). Achieving A0 success with a complex CPU design on an advanced node is extremely difficult, more so than with other types of processors with simpler designs and redundant features.

While Nvidia and some other companies indeed begin to mass produce A0 chips after the initial tape out and bring up, it often takes Intel more revisions to get rid of bugs and maximize performance and yield. For example, Intel's Xeon 'Sapphire Rapids' processor contained as many as 500 bugs, and it took Intel a dozen revisions to get rid of erratas and reach planned performance and decent yields. At the time, that chip had seen A0, A1, B0, C0, C1, C2, D0, E0, E2, E3, E4 and E5 steppings to fix the egregious number of bugs.

Tan's comments are a bit unusual for a CEO of a company of Intel's size, as he essentially says that Intel's prior engineering culture was lax, so he is improving internal execution discipline. Ultimately, Tan wants fewer respins, faster validation, and shorter development cycles.

Whether or not A0 success can be achieved by all of Intel's products remains to be seen. For example, Nvidia is known for incorporating various yield-boosting techniques into its complex GPUs (e.g., redundant logic and caches) to avoid stepping failures and costly respins. However, Intel's design approaches are different.

One of the ways to reduce risks is to use industry-standard silicon-proven IP blocks and heavily verify designs before taping them out. In addition, Intel engineers might have to make less risky design decisions to achieve first-time success. Such an approach may make Intel's produces less ambitious in general, but at least the company's business performance will be more predictable.

In August 2024, a Redditor was widely, repeatedly, and mercilessly ridiculed for investing the majority of an $800,000 inheritance in Intel stock, but given that the company just notched an all-time stock price high today, they may have the last laugh. Sadly for our thoughtful investor, their initial timing wasn’t the best, as pretty shortly after their $700,000 investment at $30.45 per share became… much smaller. Later in the same week, Intel's share values collapsed to under $20. It was a tragedy to see Grandma's life savings evaporate so quickly, with many wisecrackers rubbing salt in the wound. The Redditor has since vanished and deleted their profile. However, it looks like the $700K investor’s story will have a happy ending, and they will have the last laugh, if they did indeed hold.

I bought $700k worth of Intel stock today from r/wallstreetbets

Assuming the purchase price of $30.45 per share in the original post, and $700,000 invested, they could sell the lot for ~$1,885,000 later today (if the current $82 per share sticks).

While the Redditor’s post remains, the username is deleted. That’s understandable with the sheer amount of commenters we can see with 20-20 hindsight, clearly enjoying themselves at another’s loss.

The original r/wallstreetbets post was brimming with reasoning, logic, and positivity for Intel as an investment. True then, and now, the investment did put a lot of eggs in one tech basket, though.

The ‘bet’ quickly became a losing one. Grandma’s legacy would shrink as the news flow for Intel at the time was dire. The iconic PC chipmaker faced a string of weak guidance, missed expectations, and strategic turmoil. Competitive pressure was growing, too, and INTC’s direction seemed to be out of touch and missing the opportunity of the great AI wave.

In early August 2024, we reported on the chipmaker suspending its dividend and stock dropping 30% overnight. This was very soon after the headlining $700,000 investment. Other troubling issues we reported on at Intel during the same month include its possible loss of foundry business for SoftBank’s AI chips, various large reductions in staff, and AMD’s best server CPU market share in decades.

It would take a year of scrambling for Intel to make its way out of the doldrums, as the stock charts show. From August 2025, we have seen Intel shares relentlessly gain value, from under $20, and at the time of writing at $82.

Our inheritance investor originally claimed that they were in Intel for “a decade depending on how it performs.” Let’s hope the naysayers didn’t sway them before the significant turnaround in fortunes at Intel.

But why is INTC so clearly rampant right now? Over recent months, we have seen the huge Intel juggernaut turn around, driven by Lip Bu Tan’s deal-making. Today, we are reporting on the firm’s stock rocketing by 28% after a strong Q1 with rising forecasts. This rise is like a mirror to August 2024’s collapse.

It is also clear that the new CEO is making deals with the right people to grab firmly onto the coattails of AI tech expansionist enthusiasm. Notably, earlier this month, Intel made what is probably a future-defining agreement to join Elon Musk’s TeraFab project.

The best way to celebrate

We imagine that one day, in the not-too-distant future, the fortune-flipped investor will laugh, satisfied by their incredible wealth and canny investment acumen, while enjoying a big cigar in the TeraFab burger bar, at least if Elon Musk has his way.

In an unexpected turn of events, Intel on Tuesday said that it had joined Elon Musk's TeraFab project. The announcement mentions Intel's ability to develop, produce, and package advanced processors in high volumes, which could help Tesla, SpaceX, and xAI to get enough compute performance for next-generation AI and robotics applications. However, the announcement made in an X post you can expand below does not reveal how exactly Intel will help TeraFab.

"Intel is proud to join the Terafab project with SpaceX, xAI, and Tesla to help refactor silicon fab technology," a statement by Intel reads. "Our ability to design, fabricate, and package ultra-high-performance chips at scale will help accelerate Terafab's aim to produce 1 TW/year of compute to power future advances in AI and robotics. It was fun hosting Elon Musk at Intel this past weekend!"

The announcement is not accompanied by any press releases or SEC filings, which raises questions about the framework of the collaboration between Intel and TeraFab, as well as any possible legal bindings. In fact, the post in X is deliberately written in a way that barely reveals any concrete details about the structure of the partnership.

Officially, TeraFab is positioned as the "most epic chip-building effort ever" that is to combine "logic, memory and advanced packaging under one roof," which implies localized production in a massive facility. Furthermore, the company is hiring managers to build a greenfield semiconductor fabrication plant in Texas. By contrast, Intel's wording rather implies a virtual semiconductor production ecosystem, or even a consortium that involves chip design, manufacturing, and packaging at Intel and demand from Tesla, SpaceX, and xAI. How such a consortium would differ from a typical wafer supply agreement that large companies tend to have with their suppliers is something that is unclear at this point.

Considering the fact that Elon Musk wants his TeraFab project to ramp up production of chips as soon as possible, a reasonable way to achieve this would be to build a coordinated supply chain with a capacity pool that includes its own facilities as well as facilities belonging to other chipmakers, such as Intel. If we were to speculate further, we would envision custom co-invested fabs or at least product lines that would use unified process technologies, thus offering Elon Musk's companies dual or even triple sourcing to satisfy their demands.

In fact, Tesla, SpaceX, and xAI may even order Intel to develop custom silicon tailored specifically for their workloads, as Intel officially offers custom silicon development services, though this is speculation.

But while the Intel – TeraFab collaboration announcement lacks details on how Elon Musk plans to produce chips that would consume one terawatt of power on an annual basis, the chief executive of Intel expects Elon Musk to reimagine the entire semiconductor industry.

"Elon has a proven track record of reimagining entire industries," Lip-Bu Tan wrote in his own X post. "This is exactly what is needed in semiconductor manufacturing today. Terafab represents a step change in how silicon logic, memory and packaging will get built in the future. Intel is proud to be a partner and work closely with Elon on this highly strategic project."

SoftBank today announced its intent to purchase a historic $2 billion worth of Intel shares—a roughly 2% stake—making it one of the largest shareholders of the American chipmaker. However, the Financial Times reports that just days before the deal was inked, Softbank actually considered buying Intel's foundry division outright.

This follows another unprecedented report that the White House is considering a 10% stake in Intel, utilizing grants from the CHIPS Act and converting them into equity.

Intel received that CHIPS Act money on the promise of never spinning off the fabs the funds directly impacted, as they serve an important geopolitical role in the race for bleeding-edge semiconductors. Intel is one of the last companies in the cutting-edge process race with TSMC, whose roots in Taiwan have provoked long-simmering concerns about its vulnerability and the stability of leading-edge semiconductor supply in the event that China should invade the island in pursuit of reunification.

Intel has been struggling for years, and the current CEO, Lip-Bu Tan, was installed earlier this year to turn the company's fortunes around. Quickly, Tan shifted Intel's focus to save costs and stick to its core business. Despite efforts to bolster homegrown chipmaking, Tan has faced intense scrutiny, mostly due to his former ties with China, which even led to calls for his resignation by President Trump.

Of course, the relationship between Trump and Tan has done a 180 following a meeting in which the President was apparently won over by Tan's "amazing story."

SoftBank is a Japanese financial institution that owns a majority stake in semiconductor IP developer Arm and already has close ties with the Trump administration thanks to the Stargate project. For those out of the loop, that's a $500 billion promise to build AI infrastructure in the U.S. that would purportedly create 100,000 jobs, bolster American chipmaking, and make the country the clear leader in bleeding-edge AI applications.

SoftBank already owns 40% of that project and is now set to own 2% of Intel, marking a significant investment in the promise of a turnaround for the beleaguered company and its geopolitical importance in keeping bleeding-edge semiconductors local to America.

Lip-Bu Tan also served as a board member for SoftBank till 2022, and left amidst the company's own set of challenges following a few miscalculated investments.

Years later, Son is now investing in Intel. "Masa and I have worked closely together for decades, and I appreciate the confidence he has placed in Intel with this investment," said Tan. This endeavor aligns with SoftBank's broader strategies geared toward expanding its presence in the AI market and gaining a foothold in emerging technologies.

Previously, SoftBank invested heavily in Nvidia, owning about 4.9% of the company, but it sold those shares in 2019 when Nvidia's share price was in a downturn. After losing out on billions in gains in recent years when Nvidia began its meteoric rise, Softbank increased its investment in Nvidia to $3 billion at the beginning of 2025.

As part of its Project Izanagi initiative, Softbank reportedly explored fabricating an AI accelerator of its own with Intel in 2024, but due to a lack of confidence in Intel meeting its performance and volume projections, Softbank pivoted to TSMC for its foundry needs. SoftBank also acquired Graphcore for its AI accelerator IP as part of its larger strategy.

In a surprising turn of events on Monday, it was reported that the U.S. government was considering buying a 10% stake in Intel using CHIPS and Science Act in a bid to provide the struggling chipmaker much-needed cash. Coincidentally, SoftBank agreed to acquire Intel stock worth $2 billion, offering Intel another boost. But can an approximately $12.9 billion injection in liquid cash help Intel turn its fortunes?

Grants to equity

The Trump Administration is reportedly studying whether to convert up to $10.9 billion in promised grants under the CHIPS and Science Act into equity. iGiven the current stock price, it would give the U.S. government a 10% stake in the company.

That amount would equal about $10.5 billion at Intel's current market capitalization of around $103 billion, which is below the value of the company's real estate and fabrication facilities. However, this decision has yet to officially happen; the White House has expressed an official interest in taking a 10% stake in Intel.

Under the CHIPS and Science Act, Intel was awarded a package of $7.86 billion in grants and access to up to $11 billion in loans. The latest figure from the Bloomberg report suggests that a potential purchase of equity in Intel would exceed the previously agreed grant, from $7.86 billion, to a reported $10.9 billion, which is $3.3 billion more than previously agreed upon.

The subsidies were structured as reimbursements tied to the buildout of new fabs and construction milestones, so the funds were to be released in tranches over several years. Intel had already received $2.2 billion of those funds in late January 2025, according to Techcrunch.

The new thing about the Trump administration's plan is not more money, but a different form of support. Instead of gradually paying the grants, Washington would convert part (or all) of Intel's $10.9 billion package into equity and Intel in a lump sum, becoming the largest shareholder in the company, with a 10% stake.

As a result, Intel would not get any additional funds from the U.S. government. Intel would receive the funds sooner, and in a lump sum, while the U.S. government would move from a grantor to a shareholder.

The strategic importance of Intel

Intel is a strategically important company for the United States both in terms of economic and national security.

Processors made using leading-edge process technologies are crucially important for American companies, such as Apple, AMD, Dell, HP, Nvidia, Qualcomm, and dozens of others. Without advanced silicon, these companies will quickly lose competitive positions to Asian rivals, which might result in trillions in losses to the U.S. economy.

Intel directly employs tens of thousands in high-skilled engineering and factory jobs, though the company enacted significant layoffs in June 2025.

There's a ripple effect across suppliers, construction, and local economies, with the large number of people Intel employs. Additionally, large projects — such as the Ohio campus, known as the Silicon Heartland — are drivers of national and local economies, and are political symbols of American industrial strength and job creation.

The advantages of having a homegrown manufacturer

Advanced military and intelligence systems increasingly depend on advanced processors, many of which are now produced by TSMC in Taiwan or Samsung in South Korea. However, a domestic supplier ensures that chips intended for defense and aerospace programs are securely sourced and not exposed to supply chain disruptions or espionage risks.

Also, having a strong U.S. chipmaker improves America's position in negotiations with allies (Japan, South Korea, Taiwan, and the E.U.) that are also investing in semiconductors, and adversaries like China.

Intel is the only U.S.-based company with ambitions to make chips using leading-edge process technologies on American soil. While both TSMC and Samsung Foundry intend to build chips for U.S. companies in Arizona and Texas using advanced production nodes, they will not be their latest nodes.

In that sense, it is crucial for the U.S. government not only to keep Intel alive but also to ensure that it prospers. Losing Intel as a major player in the semiconductor industry would erode the U.S.'s foothold in one of the most important industries for the 21st-century economy, and make the country vulnerable to supply chain interruptions or foreign espionage initiatives.

Is $12.9 billion enough to save Intel?

Intel's fab projects in Arizona and Ohio are part of the U.S. push to re-shore advanced manufacturing, so the country is not entirely dependent on foreign foundries. While Intel is about to begin high-volume manufacturing (HVM) at its Fab 52 and Fab 62 facilities in Arizona, HVM in Ohio has been pushed away from late 2025, to before 2030. But the importance of the Silicon Heartland in Ohio is hard to overestimate.

Intel's Silicon Heartland project in Ohio — the company's first greenfield manufacturing site in decades — has heavily relied on government funding under the CHIPS Act, is instrumental to Intel's foundry ambitions.

The planned Ohio site will span about 1,000 acres (4 km²), with room for as many as eight chip fabs along with facilities for suppliers and partner firms. Intel projected that a complete build-out could cost roughly $100 billion, while the initial phase was budgeted at about $28 billion for two fabs and support facilities.

If Intel had four new fabs capable of producing chips on its latest process technologies, 20A and 18A, by late 2025 or early 2026, it would have capacity for its own products and foundry customers.

However, as the semiconductor market shrank in 2022 – 2023 and Intel failed to get commitments from big customers, it delayed multiple projects and scaled down its capital expenditures in 2023 - 2024.

As a result, while the Arizona fabs are enough to serve Intel's own needs and some foundry customers, it is unknown whether Intel can accommodate a large foundry client, such as Apple, Nvidia, or Qualcomm.

Intel needs to prepare for clients

If Intel plans to land a major foundry customer, it needs additional production capacity that is specifically tailored for contract chipmaking (i.e., a high-mix/low-volume fab). Since Intel is preparing to build in Ohio, the best way for the company to build additional capacity likely is to construct at least one fab in Ohio to produce chips using its 18A-P or 14A process technologies. It's also possible that Intel could build an additional fab at its Arizona site, which has all support facilities in place and a supply chain around it.

But, no matter where the new fab is — which will have both current-generation Low-Numerical Aperture (NA) and next-generation High-NA lithography tools installed — it will cost between $20 billion and $30 billion. This would be a lot of money for Intel, which bleeds billions every quarter. To add to the issue, Intel needs to begin construction as soon as possible to have the available capacity for prospective foundry partners in the years ahead.

According to Intel's latest financial reports, the company has $21.04 billion in cash and cash equivalents. So, an influx of $12 billion could be instrumental in stabilizing the company and accelerating the Ohio site buildout, or starting a new fab phase in Arizona. However, a lot depends on timing.

Since support facilities and supply chains already exist in Arizona, it could be cheaper and faster to add a new fab module in Arizona, rather than accelerating the greenfield site in Ohio.

The political and financial importance of Intel

President Trump's administration is reportedly in talks to acquire a 10% stake in Intel, according to Bloomberg.

Intel stock dropped on the news, but we now have further insight into how this deal may work. Sources close to the matter revealed to Bloomberg that the Trump administration will turn the rewards granted to Intel as part of the CHIPS Act into the purchase amount. Intel’s current valuation is around $100 billion, and the company has been set to receive about $10 billion in funding through the CHIPS Act. If you do the math, 10% of 100 is 10, making it a pretty clean conversion that could arrive more quickly for Intel than expected.

The CHIPS Act works on a milestone-based incentive system, meaning a company has to reach projected targets in order to unlock more funding. Intel had only received $2.2 billion up until January of this year, before Trump took office. We don’t know whether that $2.2 billion will be counted as part of the larger $10 billion that would otherwise be needed for the 10% stake.

The White House declined to comment to Bloomberg on this matter. If confirmed, this would make the U.S. government the largest stakeholder in Intel by far. Such an act wouldn’t be unprecedented either, as the U.S. Department of Defense recently invested $400 million in MP Materials Corp., a rare-earth producer, making the Pentagon its largest shareholder.

Lip-Bu Tan was installed as Intel CEO in March of this year, and since then the company has largely been on the cusp of ending its instability. Despite repeated commitments to U.S. soil and plans to bolster its fabs, Intel has faced consistent scrutiny, including Trump’s call for Tan’s resignation. Afterward, Tan visited the White House to discuss issues, including Tan’s former ties to China.

Intel has been on a downward spiral for the past two years. Where it once held a $200 billion market capitalization, it now sits at around $100 billion. Following former CEO Pat Gelsinger’s exit, Tan came in and quickly restructured the company, trimming the fat and laying off thousands of workers to focus on what matters: x86 and its ecosystem. Despite that, multiple reports have pointed toward struggles with the upcoming 18A and 14A nodes, which are Intel’s Hail Marys in the bleeding-edge semiconductor manufacturing industry.

Adding to the problems was Tan's stint at Cadence, which was recently convicted for selling trade secrets to China and had been run by Lip-Bu Tan until his hiring at Intel earlier this year. Tan was also revealed to have been heavily invested in multiple Chinese companies, though he claims to have since divested. This led Trump to call for his resignation on the basis of national security concerns. After the two met, just a few days ago, around 540,000 Intel shares were suddenly purchased by a group of investors. This came as Intel’s share price was already creeping upward, helped by Trump’s positive response to his meeting with Tan.

The U.S. government is considering a plan to purchase a stake in Intel in a bid to speed up completion of the company's delayed semiconductor complex in Ohio, reports Bloomberg, citing sources familiar with the matter. If the plan comes to fruition, this could become a crucial instrument to put Intel in the foundry game with the right process technologies and enough capacity. The idea reportedly emerged after the meeting between President Donald Trump and Intel's chief executive, Lip-Bu Tan, earlier this week. 

None of the parties has formally confirmed the plan, so take the information with a grain of salt. 

The idea centers on providing Intel with additional financial support to advance its manufacturing site, once called Silicon Heartland in Ohio, which was once promoted as one of the largest chip production sites in the world, once it is fully built and equipped. Construction has been repeatedly postponed, and the latest timeline pushed mass production of chips in Ohio into the next decade.

Speeding up completion of the fab would be crucial for Intel's foundry initiative, which requires ample production capacity, as well as U.S. national security, as the company and its partners will be able to produce chips on its most advanced fabrication process domestically. 

Intel's struggles did not start yesterday, but years ago, and now the company faces problems across multiple fronts. It's hard to say when things turned dark for Intel or attribute any particular business decision that led to this situation, but yet here we are: Intel is bleeding money, the performance of its products is behind offerings from AMD and Nvidia, its foundry efforts yet have to take off as its current process technologies are behind products fabbed at TSMC, and it has to lay off tens of thousands of employees to cut costs and attempt to break even in 2026.

Fabs: Money losers, or key to success?

Historically, CPU design and manufacturing might have been instrumental to Intel's success, but today, the Intel Foundry unit bleeds billions of dollars every quarter, whereas the company's flagship client CPUs are produced by TSMC. Making chips internally almost automatically pushes gross margins to over 50%, unless Intel starts a price war and offers huge discounts to maintain market share. This is, unfortunately, what is happening at Intel at this point, but we'll dive into that topic a bit later.

Intel's manufacturing and real estate assets cost around $108 billion, so Intel cannot just offload them to a consortium of investors. Furthermore, the majority of Intel's fabs can only be used to make Intel's own products developed by the company itself. Currently, only select facilities that use Intel 3 and Intel 18A process technologies can be utilized by the company's foundry clients. Other manufacturing processes currently used by Intel are not compatible with industry-standard electronic design automation (EDA) tools, so only Intel's engineers can develop products for these technologies using proprietary EDA software.

There is another thing to keep in mind about Intel's existing production facilities: these are low-mix/high-volume fabs tailored to make Intel's CPUs. These fabs are configured for maximum throughput of a single process flow and product family. Tools are dedicated and duplicated at bottlenecks to sustain high utilization; they run stable recipes for months without change. Also, the production lines are designed so that wafers move continuously with almost no buffers (i.e., waiting areas), and metrology tools are set up to monitor just one specific process in real time. Essentially, Intel's fabs are designed to minimize cost per wafer through efficiency and scale. However, these fabs are not exactly flexible.

Foundries — such as TSMC — run high-mix/low-volume fabs that are built for flexibility to serve many customers and product types. These fabs often use tools that store a wide range of process recipes and can switch between them quickly. Their layouts have staging buffers to manage different types of work-in-progress (WIP), and the automated material handling system (AMHS) is programmed for more flexible routing. They also have more metrology and inspection capacity to handle the greater variation between products, and tool redundancy is spread across many types of equipment to support different process flows. While this setup reduces tool utilization and increases cost per wafer, it enables quicker customer turnaround and supports a wider variety of products.

The key difference between Intel and TSMC is that Intel fabs operate like dedicated high-speed assembly lines, sacrificing flexibility for peak throughput and efficiency, while TSMC fabs function more like flexible manufacturing cells, accepting some efficiency loss in exchange for rapid reconfiguration and multi-product capability.

We do not know whether Intel's 18A-capable fabs in Arizona are low-mix/high-volume facilities or high-mix/low-volume facilities, but this is certainly the case with Intel's pre-IDM 2.0 philosophy and existing fabs. Now that we mentioned Intel's philosophy, it is time to talk about Intel's process technologies.

18A: A turnaround process technology?

Intel's former chief executive Pat Gelsinger touted 20A (2nm-class) and 18A (1.8nm-class) process technologies as production nodes designed for both internal products as well as for third-party foundry clients. Eventually, it turned out that foundry customers had little interest in 20A, so the company decided not to use its Arrow Lake products as a pipe cleaner, but to instead produce compute chiplets for these CPUs at TSMC and cancel 20A entirely. This decision put 18A into the focal point as Intel's 'turnaround' node meant for breakthrough Panther Lake and Nova Lake CPUs, as well as external clients.

Indeed, Intel says that it is on track to produce compute chiplets for its Panther Lake processors later this year at its Fab 52 and Fab 62 in Arizona and perhaps some volume at Fab D1X in Oregon. In addition, Microsoft is committed to using Intel's 18A for some of its upcoming data center designs, and the U.S. Department of Defense plans to use the technology to make advanced processors for aerospace and military applications. Also, Broadcom and Nvidia (probably just like a bunch of other fabless chip designers) are reportedly exploring 18A and 18A-P, but without making any commitments.

Relatively low interest in 18A may be a reason why Intel management reportedly decided to slow down promotion of 18A among external customers and instead focus on promoting its successor, the 14A node (1.4nm-class). The company has never confirmed the decision, but one of the messages from management is that 18A was not designed to be a foundry node from the ground up, which is why it could be less competitive than TSMC's N2 on the foundry market.

There might be merit in the message. Intel has produced its CPUs in-house throughout its history, so the company's main target when developing new fabrication technologies was performance. Intel started to work on 20A and 18A technologies well before the company outlined its IDM 2.0 strategy in early 2021, so while the technology has a decent process design kit (PDK), is compatible with industry-standard EDA tools, and standardized IP blocks (e.g., SRAM macros, I/O cells, PLLs), it may still be more optimized for Intel's client and data center products rather than for a broad set of applications used by external clients.

General-purpose process technologies like those offered by TSMC are designed and validated across a wide range of designs, from mobile application processors to massive AI and HPC processors, because the same node will serve dozens of companies with very different needs. This adds overhead in development time, test chip diversity, and third-party collaborations, but ensures broad compatibility and predictable yield for a wide customer base.

By contrast, nodes primarily optimized for CPUs may have specific voltage ranges and frequency targets, fewer validated device variants, fewer third-party IP options, and even narrower process windows. Therefore, to target a broader range of customers, Intel might need to do some additional homework, which may not make a lot of financial sense at this stage of development, as 18A is behind TSMC's N2 in terms of time-to-market.

However, if Intel does not land any major 18A customers, how will other potential clients know that Intel's fabrication technologies are competitive with those from TSMC in terms of performance, yield, and costs? Since the company has not abandoned its 18A as a foundry offering publicly, it is possible that it may continue to target very specific client designs with this node. If the company succeeds in landing a customer or two with its 18A technology, it will earn money while also advertising the advantages of its fabrication technologies. If not, it will at least not invest millions in an endeavor that will not pay off.

Nonetheless, even if Intel's 18A does not get many external clients, it will still be used to make Panther Lake, Nova Lake (and this processor appears to be Intel's attempt to get back into enthusiast-grade desktops with a monstrous 52-core offering), and other CPUs in the next several years, which will have a positive impact on Intel's balance sheet.

14A: The true foundry node from Intel?

If Intel indeed wants to shift its foundry effort from 18A to 14A, this adjustment may suggest that the company may be repositioning its foundry strategy to leapfrog directly to the next generation, potentially aiming to offer prospective clients a more competitive platform that has been developed as a foundry node from the ground up.

However, there is a catch with this fabrication technology. Intel recently warned that it is weighing whether to slow down or completely stop work on its 14A manufacturing platform if it cannot secure a large outside client and if development does not meet crucial milestones. This is the first time the company has openly admitted it might step back from leading-edge process technologies, potentially leaving the most advanced production nodes to rivals like TSMC and Samsung. The move reflects a shift toward basing future node development on confirmed commercial demand rather than advancing purely for the sake of technology leadership.

Intel's 14A is an important node for the company, not only because it is its first fabrication process developed for foundry customers from the ground up, but also because it will be the first technology to use High-NA EUV lithography for multiple key layers, a leap that requires extremely expensive tools that cost roughly $380 million per unit. Outfitting a fab for high-volume output on 14A would demand tens of billions in equipment purchases (with hundreds of millions for High-NA EUV scanners) on top of the billions already spent on process R&D, so Intel's executives want to ensure that the effort will pay off. On the one hand, they need to ensure that the technology delivers the right balance of performance and area scaling; on the other hand, they need volume commitments from external clients. However, by announcing that it is considering pulling out from the leading-edge semiconductor race, Intel could greatly hurt its reputation among potential customers for all of its nodes.

At present, Intel has at least one in-house product planned for the 14A platform, but management is leaving the door open to outsourcing. If the technology does not move forward, advanced designs that require greater transistor density and speed than 18A-P will be manufactured at an outside foundry (i.e., TSMC).

Should Intel shelve 14A and subsequent nodes, the company intends to continue producing the bulk of its portfolio on internal technologies up to 18A-P well into the next decade. This approach would allow Intel to cover most of its needs while avoiding large capital investments for tools and facilities that may go underused. However, relying on outside fabs for top-tier designs could have long-term effects on profitability, especially if those products are key revenue drivers. Essentially, Intel will find itself in a situation similar to today's, only without the necessity of investing billions in next-generation tools and fabs.

Intel's current product mix: A bag of hurt?

Right now, Intel's product portfolio is a mixed bag. While the company clearly has some competitive offerings in its mix, its manufacturing strategy leads to profitability woes.

On the client side, Arrow Lake-S desktop CPUs and Arrow Lake notebook parts — both made largely at TSMC — are trailing AMD's Ryzen 9000-series in performance in games, which makes them less competitive in the enthusiast and high-end segments. Several months ago, Intel even admitted that some enthusiasts still prefer its previous-gen 13th and 14th Generation Core 'Raptor Lake' processors, which are built in-house and carry a higher margin, but it is an aging design on a less advanced node, so Intel's position against AMD's Ryzen 9000 cannot be improved significantly in the high-end segment.

Lunar Lake, also fabbed externally, is aimed at thin-and-light notebooks and integrates LPDDR5X memory directly on the package. While this improves power efficiency and simplifies board design, it adds significant bill-of-materials cost and squeezes margins in a segment where pricing pressure is already intense.

For now, Intel is offering two parallel client CPU lines — made internally and externally —neither of which fully satisfies the needs for both performance leadership and profitability.

In the data center, Intel has finally ramped its Xeon 6 family — consisting of Xeon 6000P-series 'Granite Rapids' with high-performance cores and Xeon 6000E-series 'Sierra Forest' with energy-efficient small cores. Both are manufactured internally, which should, in theory, help with margins. However, the data center and AI (DCAI) group faces unprecedented competitive pressure from AMD's EPYC lineup and, to some degree, Arm-based solutions, which forces Intel to provide deep discounts at the cost of its margins.

Internal clashes

As if usual challenges with process technology development and competitiveness of product mix were not enough, Intel apparently has internal clashes on the board-of-directors level.

Earlier in 2025, Intel board chairman Frank Yeary reportedly explored spinning off Intel Foundry into a joint venture with TSMC and major fabless chipmakers — or even selling its controlling stake outright to TSMC. These proposals were reportedly opposed by newly appointed CEO Lip-Bu Tan, which sparked internal friction, as Tan viewed keeping Intel's own fabs as vital for competitiveness and an important factor for the U.S. national security (i.e, so Intel would have a bargaining chip with the U.S. government). While some directors backed Yeary, the spin-off did not happen, but the disagreements ultimately undermined Tan's early strategic efforts.

The disputes slowed or blocked several of Tan's plans, including raising billions from Wall Street to boost Intel's manufacturing investments and acquire an AI accelerator developer, according to the Wall Street Journal. As a consequence, prolonged debates allowed a competing tech company to move closer to securing the AI target before Intel could act.

To add to an already rather intense situation on Intel's board, it should be noted that TSMC had little (if any at all) interest in taking over Intel's manufacturing facilities both because these are low-mix/high-volume fabs tailored for making CPUs and because the companies use completely different process technologies and converting Intel's fabs to TSMC's production methods wouldn't make financial sense for the company. Given these limitations, the idea was improbable from the start, yet it still supposedly became a flashpoint in leadership disputes.

Political pressure

To top Intel's list of pains, last week, U.S. President Donald Trump publicly called for Intel CEO Lip-Bu Tan to resign over alleged conflicts of interest tied to his financial holdings in Chinese technology companies, some linked to China's military.

Tan, who retains his stakes in over 600 Chinese firms through his venture capital led by Walden International, rejected the accusations in a letter to employees. He wrote that the accusations were based on misinformation and stressed his adherence to strict legal and ethical standards. While the Intel board officially expressed full support for Tan, industry sources suggest the criticism may also be driven by internal dissatisfaction over job cuts and clashes on the board level.

To persuade the U.S. President over his loyalty to Intel and the U.S., Lip-Bu Tan plans to talk with Donald Trump on Monday, and we'll likely learn about the results at a later time.

Summary

Intel faces deep, multi-front challenges that it must solve to survive.

Intel's client CPU lineup is split between TSMC-made chips with thin margins and older in-house designs that trail AMD in performance, while new Xeon 6 server CPUs face fierce competition and margin pressure. The company's foundry efforts have yet to gain traction as Intel's 18A is behind TSMC's N2 in terms of time-to-market for external customers and is barely endorsed by major clients. Intel's 14A promises to be a better fit for foundry customers as it was designed as a foundry node from its inception, but to make 14A happen, Intel must land at least one major client to pay off its massive investments.

Unfortunately, Intel faces problems beyond the product and manufacturing facility levels. Internal conflicts on the BoD level have slowed strategic moves, including a proposed AI hardware developer acquisition, and political pressure has mounted after President Trump called for CEO Lip-Bu Tan's resignation over alleged conflicts of interest tied to his Chinese investments.

Intel CEO Lip-Bu Tan is reportedly set to visit the White House on Monday, following President Trump's call for his resignation last week and probes into his connections with China, as revealed by The Wall Street Journal

Intel has endured a torrid run of form lately. From faltering business performance to a gloomy outlook for its future nodes, the American powerhouse is under major scrutiny that it can’t seem to escape. Most recently, Intel’s CEO Lip-Bu Tan was probed by a U.S. Senator over his ties to China—which Tan addressed—after which President Trump called for his resignation. Now, the situation has escalated to the point where even Intel’s board is reportedly at odds with Tan.

According to the report, Tan will be going to the White House today to meet President Trump. The purpose of the visit is clear: to elucidate recent developments and assure the U.S. government that both Tan and Intel are fully committed to the nation’s goal of semiconductor independence, with no security concerns to worry about. Tan, who previously served as CEO of Cadence—the company recently found guilty of selling trade secrets to China— has invested heavily in some 600 Chinese firms, some linked to the Chinese military.

Tan will reportedly discuss both his personal and professional background, explaining his stance on the state’s stringent anti-China tack. Intel’s fabs are some of the only American equivalents to giants like TSMC that can potentially compete with the East. Last year, Intel received $8 billion through the CHIPS Act to keep its manufacturing facilities running and prevent them from being spun off. Tan will likely emphasize the connection between these fabs and national security in front of Trump, while also outlining other ways the two could collaborate to strengthen America’s chipmaking prowess

Intel board chairman Frank Yeary attempted to spin off Intel Foundry or even sell it to TSMC earlier this year, but faced strong opposition from Lip-Bu Tan, chief executive of Intel appointed in March, reports the Wall Street Journal. Reportedly, other directors supported Yeary, but clashes on the board began, eventually resulting in the failure of Lip-Bu Tan's strategic initiatives. The WSJ report claims that the Intel board maintains its official support for Tan, but his leadership is under mounting strain internally and externally.

Chairman tried to unload Intel's manufacturing assets

Earlier this year, we reported numerous times that Intel was planning to spin off its Intel Foundry manufacturing unit into a separate company co-owned by Intel, TSMC, and large fabless chip designers like Broadcom or Nvidia, which would have to invest in the new entity. Another report said that Intel would sell Intel Foundry to TSMC, either entirely or partly. TSMC would gain operational and strategic control over the production entity and would have to 'fix' Intel's process technologies. Intel has never confirmed either plan, but as it turns out from the WSJ report, both plans were brokered by Intel board chairman Frank Yeary, a former investment banker.

As a result, from the start of his tenure in March 2025, Lip-Bu Tan has clashed with the chairman and certain directors on whether Intel should maintain its own semiconductor production or exit that business altogether, WSJ claims. Unlike Yeary and some other directors, Tan reportedly sees internal chip fabrication as essential to Intel's competitiveness and to safeguarding America's supply chain from over-reliance on foreign players such as TSMC and Samsung.

But were the deals feasible?

TSMC never wanted to buy Intel's fabs or manufacturing assets due to both technical and business reasons.

On the technical side of things, TSMC's staff lacks experience with Intel's EUV-based process flows, so it could hardly help Intel to improve its Intel 3 or Intel 18A fabrication technologies. In addition, both nodes are already used by Intel and third-party customers (will be used in case of 18A). Moving TSMC's process technologies to an Intel U.S. fab is complicated because, despite both using EUV lithography tools from ASML and a lot of other tools from makers like Applied Materials, KLA, and LAM, each company's tools, calibration, and vendor-specific setups differ. ASML litho systems often have bespoke tuning or added modules tailored to each firm's process recipes.

Intel and TSMC also run distinct etch and deposition methods, and even small changes in materials — such as photoresists or etch chemicals — can cause yield loss or performance variation. Supplier lists differ as well, so TSMC's approved materials might not work reliably on Intel's lines. The bottom line is that even minor variations in gas flows, temperature stability, or mask handling can shift dimensions and electrical characteristics, making the transfer costly and risky.

As for business reasons, TSMC had little incentive to help a direct competitor refine its chip production. It was also hardly interested in investing billions in fabs without knowing that they would be fully and profitably utilized. Also, Intel's U.S. EUV capacity would be insufficient for both its own needs and TSMC's customers.

TSMC's main reason to consider a U.S. collaboration would be to sidestep potential Trump tariffs that might require building N3 and N2 chips domestically. However, now that the company vowed to invest up to $165 billion in its U.S. production facilities over an unknown period, its incentive to team up with Intel has vanished.

For Intel, cooperation with TSMC offered limited upside as well: TSMC engineers probably could not meaningfully advance Intel's 3 nm or 18A nodes in terms of yields or performance. Shifting TSMC processes into Intel's U.S. fabs would leave its Irish and Israeli plants as the only sites running Intel's own nodes, which would risk undermining their economics, since advanced process development costs billions, and those billions can only be earned when producing in high volumes across multiple fabs. TSMC, for its part, is unlikely to deploy its leading-edge technologies into Intel's overseas fabs, even under a joint venture, as it could create excess capacity and hurt the company's margins.

Internal conflicts slowdown decisions

The appointment of Lip‑Bu Tan as Intel’s CEO has prompted U.S. Senator Tom Cotton to scrutinize his past business ties to Chinese tech firms—and whether those connections threaten Intel’s role in American defense-linked supply chains. As reported on by Reuters, in a letter to board chair Frank Yeary, Cotton questioned whether the board vetted Tan’s involvement in companies with ties to the Chinese military and if he sufficiently divested from them prior to leading Intel.

Intel is actively involved in the federal Secure Enclave initiative, which aims to secure microelectronics for U.S. defense use, and holds a roughly $3 billion contract with the Department of Defense. Cotton’s letter asks whether Tan’s investment history could compromise Intel’s obligations under such programs. Intel has landed in hot water surrounding national security concerns multiple times before, too.

As background, a Reuters investigation in April revealed that Tan invested at least $200 million in over 600 Chinese firms through his venture firm Walden International and related entities. Several firms were tied to the People’s Liberation Army, including early investments in SMIC and partnerships with state-linked companies such as China Electronics Corporation. Although divestiture was claimed, Chinese databases still listed many of those firms as active holdings, raising compliance questions.

In the wake of recent layoffs, the Intel Oregon workforce is down to its lowest point in more than a decade, reports Oregon Live / The Oregonian. Worryingly, the newspaper’s sources have indicated that this isn’t the end for Intel's Oregon job cuts. Moreover, cuts as deep as this do not just affect Intel and its newly redundant staff; the Oregonian highlights the fact that the well-paid roles “helped buoy the whole state,” thanks to tax receipts and other factors.

Intel has a long and illustrious history in Oregon, but its inexorable growth now seems to have done more than just stall. This change in fortunes will be especially painful to the lives and plans of employees. Only a year ago, they would have been hearing and reading reports about a massive expansion in Oregon, with thousands more jobs.

With cuts of “at least 5,400 Oregon jobs since August,” according to the source, there are now 18,000 employees left in Oregon. Despite this massive cut in jobs, “Oregon will continue to play a critical role in Intel’s global operations, serving as the epicenter of our cutting-edge semiconductor research, technology development, and manufacturing,” Intel reportedly said in a statement on Monday.

Lip-Bu Tan’s "simple math" knows no mercy

Back in April, we first heard reports of recently installed CEO Lip-Bu Tan getting ready to swing his axe to cull 20% of the workforce for cost and efficiency savings. Sadly for Intel employees, they’d already faced a reduction of approximately. 15,000 positions last August.

In the new Oregonian report on job cuts, Tan is quoted as explaining his severe personnel pruning activity as “simple math.” Talking to employees, he noted that the combined ranks of Nvidia and TSMC had only a slightly higher headcount than Intel alone. However, both those rivals are far more profitable.

Impacts beyond Intel's campus

Intel's new CEO Lip Bu-Tan took to the stage at the company's Intel Foundry Direct 2025 event here in San Jose, California, to outline the company's progress on its foundry initiative. Tan announced that the company is now engaging lead customers for its upcoming 14A process node (1.4nm equivalent), the follow-on generation of its 18A process node. Intel already has several customers with plans to tape out 14A test chips, which now come with an enhanced version of the company's backside power delivery technology dubbed PowerDirect. Tan also revealed that the company's crucial 18A node is now in risk production with volume manufacturing on schedule for later this year.

Intel also revealed that its new 18A-P extension, a high-performance variant of the 18A node, is now running through the fab with early wafers. Additionally, the company is developing a new 18A-PT variant that supports Foveros Direct 3D with hybrid bonding interconnects, enabling the company to stack dies vertically on top of its most advanced leading-edge node.

The Foveros Direct 3D technology is a key development because it provides a capability that rival TSMC already uses in production, most famously in AMD's 3D V-Cache products. In fact, Intel's implementation matches TSMC's offering in critical interconnect density measurements.

On the mature-node side of the operation, Intel Foundry has its first production 16nm tapeout in the fab now, and the company is also now engaging customers for the 12nm node it is developing in partnership with UMC.

Perhaps the most important developments at the show revolve around Intel's continued expansion with EDA and intellectual property (IP) partners that provide the critical tools and IP blocks that enable its customers to develop new designs with industry-standard design flows and tools. The company has also expanded its Intel Foundry Accelerator Alliance program to include the Chiplet Alliance and Value Chain Alliance programs.

Intel Foundry's progress comes during turbulent times in the semiconductor industry as geopolitical divisions threaten to fracture the global chip supply chain. Intel is currently the only US-based domestic supplier of leading-edge process node technology and advanced packaging capacity, a key advantage as tensions between China and TSMC continue to escalate. Despite TSMC's expansion of production in the US, a recent law passed by Taiwan now prevents the company from producing its most cutting-edge tech in the United States, leaving Intel as the only domestic foundry with both leading-edge chip production and R&D.

Naga Chandrasekaran, the Chief Technology and Operations Officer of Intel Foundry, and Kevin O’Buckley, the General Manager of Foundry Services, are also slated to deliver keynotes during the event, providing more details about the technology and roadmaps. We will update this article with additional information as it becomes available, but we have plenty to share to get started. Let's take a closer look at Intel's progress.

Intel 14A Process Node

Intel 14A Process Node

Intel's 14A, the next generation after 18A, is already in the works and scheduled for risk production in 2027. If all goes to plan, 14A will be the industry's first node to employ High-NA EUV lithography. TSMC's competing A14 (1.4nm-class) node is expected to arrive in 2028, but the Taiwanese company will not utilize High-NA for production.

Intel has already shared early versions of the Process Design Kit (PDK), a set of data, documentation, and design rules that enables the design and validation of a processor design, with its lead 14A customers. Intel states that multiple customers have already indicated their intention to build chips using the 14A process node.

Intel's 14A will have a second-generation version of its PowerVia backside power delivery technology. The new PowerDirect implementation is a more advanced and complex scheme that delivers power directly to each transistor's source and drain through specialized contacts, which minimizes resistance and maximizes power efficiency. This is a more direct and efficient connection than Intel's current PowerVia scheme, which connects to the contact level of the transistors with Nano TSVs.

TSMC's N2 node does not include backside power delivery; however, with A16, the company will employ a direct-contact backside power delivery network, dubbed Super Power Rail (SPR). A16 is essentially a derivative of the N2P node with SPR. The A16 node is expected to enter production in late 2026. TSMC's A14 will not leverage a backside power design methodology.

Intel's 18A-PT process node enables die stacking

Intel's 18A-PT process node enables die stacking

Intel's 18A node is the mainstream variant, but the company also has several 'line extensions' of the node, designated by different suffixes. These flavors of the underlying node are tailored for different use cases.

Intel has a new 18A variant up its sleeve; the new 18A-PT node that will provide the same performance and efficiency benefits as the performance-oriented 18A-P, but adds in Foveros Direct 3D hybrid bonding. This bump-less copper-to-copper bonding technique (meaning it doesn't use microbumps or solder to connect the two dies) fuses chips together with through-silicon vias (TSVs). Intel's implementation will employ a pitch of less than 5 microns, a distinct improvement over its initial goal of a 10um pitch by 2023, to fuse chiplets on top of the 18A-PT die. The pitch is a measurement of the center-to-center spacing between the interconnects, and lower values indicate higher density, which is better.

Notably, AMD uses TSMC's SoIC-X technology, a similar hybrid bonding approach, to fuse an L3 chiplet atop its X3D processors with a 9 micron bump pitch. TSMC's SOIC-X tech currently ranges from 4.5 to 9 microns, but the company has a 3-micron pitch offering on the roadmap for 2027. If productized effectively and on schedule, Intel's Foveros Direct 3D will dramatically improve its positioning against TSMC's packaging technology.

Intel's Clearwater Forest will be its first to use Foveros Direct 3D packaging, but the company hasn't disclosed the pitch for that specific product yet. Notably, TSVs are typically only included in the base die, and Clearwater Forest uses Intel 3-T for the base die with the Intel 18A compute dies stacked on top. Enabling TSVs for 18A will thus allow it to also have dies stacked atop, and SRAM cache is a logical use case.

Intel 18A process node updates

Intel 18A process node updates

As we reported last month, Intel's 18A (1.8 nm-equivalent) process node has entered risk production, marking the commencement of the first low-volume production runs of the node, with High Volume Manufacturing (HVM) scheduled for the end of the year. Intel did not specify which processors had begun production, but the timing generally aligns with expectations for its Panther Lake processors, which are expected to arrive at the end of the year. Intel's first 18A production will come from its Oregon fabs, but the company has already 'run the [18A] lot' through its Arizona fab, indicating it will soon begin production there as well.

The 18A node is the first in the industry to be productized with both a PowerVia backside power delivery network (BSPDN) and RibbonFET gate-all-around (GAA) transistors. PowerVia provides optimized power routing on the back of the chip to improve performance and transistor density. RibbonFET also offers better transistor density, along with faster transistor switching, in a smaller area through the use of four vertical nanosheets surrounded entirely by the gate.

The 18A node enters HVM in roughly the same timeframe as TSMC's competing 2nm N2 node. However, TSMC's N2 node does not come with a backside power delivery network, but it does have GAA technology with three vertical nanosheets. There have been some basic comparisons between the process nodes made based on presentations at a recent industry event. The general takeaway is that Intel's node is faster and lower-power than TSMC's, though TSMC retains the edge in density (and presumably cost). However, these distinctions could vary depending on the specific implementation in different chip designs.

Intel divulged today that it has wafers of its high-performance 18A-P node in the fab. This 18A variant features an optimized power and frequency curve, providing an 8% improvement in performance per watt. This can be leveraged as either higher clock speeds or lower power consumption at the same performance, depending upon chip-specific tuning.

The 18A-P node is design rule-compatible with the 18A node, easing the design process for customers. Intel is already collaborating with Electronic Design Automation (EDA) software vendors to enable broad support for industry-standard design tools, and it is also working with Intellectual Property (IP) designers to provide the necessary IP blocks, thereby simplifying implementation.

Mature Nodes: 16nm and 12nm continue advancing

Mature Nodes: 16nm and 12nm continue advancing

Intel Foundry not only addresses the leading edge of technology, but it is also working on several mature nodes. Intel's 16nm node, which is essentially a version of its 22FFL node that leverages industry standard design tools and PDKs, has a tapeout in the fab now.

Intel is also continuing its work with partner UMC to develop a 12nm node that will be produced in three of Intel's Arizona fabs beginning in 2027. In fact, Intel is currently engaging lead customer for this node. 12nm will be used primarily for mobile communication infrastructure and networking applications.

Takeaways, for now

Takeaways, for now

Intel canceled high volume manufacturing of the 20A node as a cost-cutting measure, but the company is now on the cusp of of production with with its18A node, marking a critical milestone as it looks to regain the manufacturing lead over TSMC. The addition of new line extensions, with the die-stacking-capable 18A-PT being a particularly strong advance, will help the company to further broaden its appeal to potential foundry customers.

The development of the company's 14A node is also well underway, signifying that the company is on track to providing a steady cadence of new nodes and features to the roadmap. We haven't yet heard any new details about Intel's plans for its 10A (1nm-class) process node yet, which is expected to begin development in 2027. Intel's press release also doesn't mention any new progress on its Intel 3 node, but we expect more details to emerge throughout the day.

Intel's event is focused heavily on displaying its broad portfolio of EDA, IP, and services driven by an ecosystem of indsutry stalwarts, like Synopsys and Cadence. The new Intel Foundry Chiplet Alliance is also an important development that will enable customers to mix-and-match chiplets into their design based upon interoperable and validated designs.

Intel's advanced packaging services are also of particular importance as they provide the fastest on-ramp to meaningful revenue generation. Intel did mention that it will make its 3D stacking Foveros implementation available to foundry customers, and noted a new partnership with Amkor. However, details are slight for now. We'll update this article as more information becomes available.

Lip-Bu Tan, the newly appointed chief executive of Intel has launched a major leadership overhaul aimed at streamlining decision-making at the company, according to Reuters. With the new changes, Sachin Katti will become the chief technology office officer of Intel and will lead the company's AI effort. Also, the new management structure will get flatter and technical leaders from key groups will get direct lines with the CEO.

"Sachin Katti is expanding his role to include chief technology and AI officer for Intel," a spokesperson for Intel confirmed to Tom's Hardware. "As part of this, he will lead our overall AI strategy and AI product roadmap, as well as Intel Labs and our relationship with the startup and developer ecosystems."

New CTO

Up until now, Sachin Katti was in charge for Intel's networking and edge computing business unit and prior to that he was CTO of that unit. However, with the new expansion of his role, he will become chief technology officer of the whole company and the head of Intel Labs, therefore responsible for all the fundamental and applied research at Intel, which includes fundamental research for Intel's process technologies.

As part of his job as head of Intel Labs, Katti will also be in charge of relationships with startup and developer communities. Furthermore, Katti will also be in charge of Intel's new AI strategy and products roadmap.

The appointment of a dedicated AI chief is perhaps a long overdue job as Intel's AI strategy so far has not exactly been a success. Perhaps the problem is that AI was a part of Intel's data center unit and was considered as somewhat of a second-class citizen and therefore competed both for resources and management attention. With a dedicated lead, this could change, but keep in mind that Sachin Katti will not be solely dedicated to AI as he will be Intel's CTO as well as in charge of the edge and networking business.

Intel's chief technology officers (CTOs) role was originally focused on traditional technology development oversight, but in the recent years it got additional roles. Intel's 'classic' CTOs were Pat Gelsinger (2001 - 2009), Justin Rattner (2009 – 2013), and Michael Mayberry (2017 – 2021), who led the company's technology strategies that included CPU, systems, communications, and process technologies for making semiconductors. Intel had no CTO between 2013 and 2017 at all.

Greg Lavender, who served as Intel's CTO from 2021 to 2025, joined the company in 2021 from VMware and among his responsibilities as CTO were defining and executing Intel's software strategy across AI, accelerated computing and confidential computing, as well as leading the Intel Labs, Intel Federal LLC, and Intel Information Technology (IT) units.

That said, Katti will not be the first Intel CTO with additional responsibilities. However, Katti's CTO and AI responsibilities are both strategically important for the company's future and the fusion of the roles may be a strategic move by Lip-Bu Tan.

Technical leaders get direct line to CEO

While the Intel CTO role at Intel has become less apparent — and the vast responsibilities of Sachin Katti just prove that — Lip-Bu Tan is taking a more hands-on approach on development of key technologies and has established direct lines of communication with key technical leaders Rob Bruckner, Mike Hurley, and Lisa Pearce.

Let us detail their roles:

• Rob Bruckner serves as CTO of client platform architecture and definition (CPAD) organization within the Client Computing Group (CCG) that earns tens of billions of dollars a year.
• Mike Hurley serves as general manager of the client silicon engineering group (CSEG), overseeing end-to-end execution for all client products. His responsibilities include silicon architecture and design engineering, hardware and firmware IP development, as well as post-silicon validation and manufacturing readiness to ensure successful product delivery to market.
• Lisa Pearce is Intel's general manager of GPU and NPU hardware and software IP. This is not a key business division, but GPU and NPU hardware is strategically important for the company's CPUs, integrated and standalone GPUs, as well as a broader AI scope.

Previously, these executives reported to Michelle Johnston Holthaus, chief executive of Intel Products group overseeing everything from controller chips for client PCs all the way to premium data center-grade CPUs and server platforms. Yet, Michelle Johnston Holthaus is not going anywhere.

"I want to roll up my sleeves with the engineering and product teams so I can learn what is needed to strengthen our solutions," Tan is reported to have written by Reuters. "As Michelle and I drive this work, we plan to evolve and expand her role with more details to come in the future."

In addition, Intel is also changing how the CEO will work with the government affairs head: the new one will report directly to Lip-Bu Tan, which reflects the strategic importance of global regulatory relationships amid rising geopolitical tensions and ongoing tariffs on China. Bruce Andrews, who had previously worked for the U.S. Commerce Department under President Obama, left Intel after the U.S. elections in November.

Summary

Lip-Bu Tan, the newly appointed CEO of Intel, has invested in hundreds of Chinese technology companies, including several linked to China's People's Liberation Army as well as Semiconductor Manufacturing International Corp. (SMIC), China's foundry champion, according to a review of American and Chinese corporate documents conducted by Reuters. The information raises concerns due to Intel's close work with the U.S. defense sector.

The corporate documents reviewed by Reuters show that Tan controls over 40 companies in China and has minority stakes in over 600 entities in China via investment companies he manages or owns. The value of the stakes is at least $200 million. Some of the companies Tan has invested in are contractors and suppliers for the People's Liberation Army. In numerous cases, Tan's stakes are shared with Chinese state-owned groups or regional government-backed investment funds. 

Tan has made many of his investments through Walden International, the venture capital firm he founded in 1987 and which he still chairs. He has also used two Hong Kong-based entities — Sakarya Limited and Seine Limited — for investment purposes. Tan is the sole owner of Sakarya, whereas Seine is under Walden's control.

Through his venture capital firm, Walden International, and affiliated entities, Lip-Bu Tan has invested in several Chinese technology companies, including those that are now on the U.S. Department of Commerce's Entity List for their alleged ties with China's government, military, and secret services.

The list of such companies includes SMIC (China's top chipmaker, though Walden exited its SMIC investment in 2021), Dapu Technologies (a PLA contractor), HAI Robotics (a contractor to Chinese surveillance companies and a bidder for a PLA contract), Intellifusion (a surveillance technology company), QST Group (a sensor supplier for Russian military drones captured in Ukraine), and Wuxi Xinxiang Information Technology Co. (a supplier to YMTC).

Holding shares in Chinese companies with ties to the military and secret services is legal unless those firms appear on specific U.S. government restriction lists, such as the U.S. Treasury's list of Chinese Military-Industrial Complex Companies. Yet, there are, of course, ethical concerns about investing in Chinese surveillance companies as well as companies supplying technology for the Russian army.

While the Chinese companies controlled by Lip-Bu Tan barely compete against Intel, their ties to the PLA certainly raise concerns. Also, industry observers note it is odd for a CEO of Intel to own a stake in contract chipmaker SMIC as Intel is trying to become a foundry itself.

Some investors and observers see Tan's ties to hundreds of companies in China as a liability. Andrew King, a partner at Bastille Ventures, questioned Tan’s suitability for leading a company with defense connections, citing national security concerns. Stephen Diamond, a law professor at Santa Clara University, said these types of ties should be a major concern for Intel's leadership, given the political climate.

However, others view Tan's extensive experience in Chinese tech as an asset. Bernstein analyst Stacey Rasgon called Tan a highly regarded figure among investors and praised his decades-long track record in the field.

Intel did not provide direct comments on Tan's investments but stated that he completed a required disclosure form for company executives, as mandated by the SEC.

Intel CEO Lip-Bu Tan is projected to have lost around $5.28 million in value as the company’s shares took a tumble alongside the rest of the market. When Mr. Tan took the reins of the chip giant in March 2025, he needed to purchase $25 million of Intel stock to make him eligible for the nearly $68 million in bonuses. The stock price around this time was $23.96, allowing him to buy 1,043,406 shares. However, Intel’s stock price at the time of writing is $18.90, putting the value of Mr. Tan’s investments at less than $20 million.

The board likely required Lip-Bu Tan to purchase this stock to ensure he’s invested in the company's performance, which is tied to his results as its chief executive. However, this recent drop has nothing to do with his performance, as he has only been on the job for around one month. Instead, this dip is part of the market chaos brought on by Trump’s tariffs, with Intel and many other chip companies hitting record lows.

Some analysts wonder if Tan will purchase more Intel stock at this low price or if the company will launch a stock buyback plan to help reverse this trend. After all, Broadcom just announced a $10 billion stock buyback plan, which helped its stock price go up by 3%. The fabless chip maker said it made this move because it was confident in its products and services despite the ongoing upheaval in the American economy.

It’s unlikely that cash-strapped Intel will copy this strategy, though. The company’s finances have reached the point that its former CEO was frustrated with the delays in releasing its CHIPS Act funding. Aside from that, it would be better for the company to focus on its 18A process node, which has already entered risk production, instead of playing with its stock price.

The $5 million reduction in value might seem like a significant sum, but CCN estimates that the Intel CEO is worth at least $593.2 million, which is just a drop in the bucket for him. Furthermore, anyone invested in the market, in general, will likely see a similar drop in the percentage. We’ll have to wait and see how the tariffs will play out before we can truly determine if Mr. Tan lost a lot of money today, but hopefully, Intel and the rest of the industry will be able to bounce back from this chaos.

Recently appointed Intel CEO Lip-Bu Tan made his first keynote at Intel Vision 2025, where he said he will focus on earning customer trust and catering to their needs and demands. This change in the chipmaking giant’s mindset began with former CEO Pat Gelsinger’s IDM 2.0 plan, and Mr. Tan is apparently pushing this agenda harder with support from his predecessor.

Intel needs to do this, especially as TSMC founder Morris Chang said that Tim Cook told him in 2011 that Intel didn’t know how to be a foundry. It was thought that Team Blue could not accommodate the changes external chip customers required, making it a poor fit for manufacturing the highly customized chips that different devices necessitate.

“Foundry is a service business, and that is built on the foundational principle of trust — that is very important,” said Mr. Tan. “And also realize that every foundry customer has their own unique design methodology and style of design. That I part I learned from my Cadence days, and it is something that we need to learn and how to adopt [to] each different customer.”

Flexibility allowed TSMC to surpass Intel in the semiconductor industry, especially as this characteristic enabled the company to land Apple as its exclusive chip supplier. Having a huge cash cow like that allowed the company to invest more into research and development, which is likely why TSMC is the leading semiconductor company today.

But Intel isn’t just giving up the fight, especially with the pending arrival of its Intel 18A process node. Mr. Tan said that he’s looking forward to shipping Panther Lake on 18A later this year, especially as it begins high-volume production. Beyond that, he also mentioned the company is continuing work on the more advanced 14A node.

To drive this innovation, Lip-Bu Tan said, “Under my leadership, Intel will be an engineering-focused company. One of my top priorities is to retain and recruit top talent — engineering — and empower innovation and growth.” He also added, “I believe Intel has lost some of this talent over the years; I want to create a culture of innovation empowerment.”

Before Mr. Tan came on board as the company CEO, there was speculation on whether the next CEO should spin off Intel’s foundry business, and if they should slash more jobs to help with profitability. After his speech, it now seems that the path he’ll take for Intel is to keep the foundry and win more customers. Furthermore, Lip-Bu Tan is apparently trying to hire more engineers and other talents the company needs to advance innovation.

The Intel CEO’s keynote address at Vision 2025 sheds light on the path that Intel will take in the coming years. It will take a much longer time to rehabilitate the entire company, but Lip-Bu Tan’s direction aims to pull the company back from the brink.

Pat Gelsinger became chief executive of Intel back in 2021 with the aim to turn the company around and regain process technology and product leadership over several years. He was ousted in late 2024 before the job was done, but he remains strongly supportive of the company's mission, so he wants to see the new CEO — Lip-Bu Tan — to finish what he started, he said in an interview with CNBC.

"I was committed to and wanting to finish that story on the revitalization of Intel and with the board, the company, and now with Lip-Bu's leadership, you are really cheering them on to finish, because the role that Intel plays in the semiconductor industry is critical and one that's important not just for the industry but for the U.S., so I could not be more supportive of the team and Lip-Bu to finishing their journey," said Pat Gelsinger.

The challenges Intel faced, particularly around funding and market expectations, made the transformation extremely difficult. Gelsinger pointed out that one of the biggest obstacles was the financial burden of building a next-generation fabrication network. He noted that his IDM 2.0 strategy — under which Intel remains a vertically integrated maker of its own chips and a contract chipmaker with third party clients — was still the correct one, but acknowledged how capital-intensive and demanding it is for any company.

As Intel's core business declined faster than expected, it became clear that external capital was needed to fund the initiative.

"It is a heavy assignment, and for any company to carry the financial requirements of building next-generation technology fab network, it is very heavy in terms of capital returns required and the investments required to go accomplish that," Gelsinger acknowledged. "As Intel's core business was challenged and deteriorated more quickly than many people expected, there was just such a need for capital to come from elsewhere."

The former CEO of Intel also criticized the short-term focus of financial markets, which he said clashed with the long-term nature of the transformation Intel was undergoing. He described the tension of trying to execute a multi-year strategic shift while meeting quarterly financial expectations, emphasizing that such balancing was extremely difficult. He noted that this is exactly what Lip-Bu Tan will face in the coming quarters.

"As I have spoken about, the short-termism of Wall Street makes that very challenging and why, yet again, I would say my very best to Intel and Lip-Bu in finishing that seminally important journey," said Gelsinger. "Being a CEO for a transforming public company I truly think is one of the hardest jobs available, because you are trying to do a five-plus-year transformation on a 90-day shot clock, with heavy financial expectation — that is hard."

In summary, Pat Gelsinger made it clear that despite leaving, he wants Intel — the company that he spent decades in — to succeed and believes in the path the company is on. He reiterated his full support for both the board and Lip-Bu Tan as they continue forward with the IDM 2.0 vision.

Intel appointed a new CEO this week after ousting Pat Gelsinger in late 2024, finally giving it a permanent chief executive. Lip-Bu Tan will take the helm of the tech giant, and he’ll be paid handsomely for his efforts.

According to a CNBC report, Mr. Tan will receive $1 million as part of his annual base salary and a yearly bonus of $2,000,000. In comparison, Gelsinger had an annual base salary of $1.25 million with cash bonuses that span up to 275%.

Tan will also receive a long-term equity grant of $14.4 million and a performance grant of $17 million (both in Intel shares) to be paid over five years if Intel’s stock doesn’t drop over the next three years. Tan also gets stock options worth $9.6 million and a new hire option grant of $25 million.

The bonuses total about $68 million in value at face value. While this may seem significant, the $2 million annual cash bonus and $31.4 million in stock grants over five years are tied to his performance as the company leader.

Tan is not also given stock options and a new hire option grant—instead, he has the option to purchase Intel stock at a predetermined price, with the total value of these stocks at the time of writing at $34.6 million. Finally, he needed to purchase and hold $25 million in Intel shares to be eligible for all these rewards.

Can Lip-Bu Tan turn Intel around?

These figures are massive, especially for a struggling company that laid off nearly 15% of its workers less than a year ago. However, Tan's bonuses are all tied to his performance. If the company’s stock price dips further in three years, he will forfeit the stock grants, and his holdings in Intel stocks will also devalue, which could potentially net him a total loss.

Lip-Bu Tan is a former Intel board member who allegedly left after clashing with Gelsinger’s strategy for turning around the company. Despite that, there were rumors that Tan was being considered for the position soon after Pat Gelsinger stepped down. When the company finally announced the appointment, Intel's stock rallied by 15%, indicating the market’s confidence in the decision.

Many Intel employees are apprehensive about it, though, as Tan’s alleged reason for leaving the board was that Gelsinger’s cuts weren’t enough to keep the company afloat. He has already warned about “tough decisions” during his introductory video call with the rest of the company but hasn’t made any concrete announcements yet. We will know more in the coming weeks as Lip-Bu Tan takes control of the chipmaker, but we hope his leadership will finally turn around the company’s fortunes.

The appointment of Lip-Bu Tan as Intel's chief executive has generally pleased investors and financial analysts, but employees expressed mixed feelings following Tan's initial address, in which he hinted at tough decisions ahead but offered limited clarity on his strategic vision, reports Oregon Live.

Tan, who reportedly stepped down from Intel's board last August because he expected then-CEO Pat Gelsinger to make Intel leaner, is widely expected to make significant job cuts to reduce costs.

Not enough clarity

During his introductory video call, Tan — Intel's first external CEO in its 57-year history —emphasized satisfying customers and shareholders. However, his appearance sparked some criticism, as he wore a shirt from his former company, Cadence Design Systems, instead of one carrying the Intel logo. He cautioned employees — many still unsettled by the recent job and spending cuts — that more difficult decisions were incoming. There are concerns that Tan, who reportedly stepped down from Intel's board last year due to frustration with internal inefficiencies, may push for more job cuts.

One major topic Tan avoided was whether Intel would separate its manufacturing operations from its chip design division. This issue has been a central debate among analysts and former board members. Instead, Tan reiterated his commitment to maintaining Intel's engineering strength as part of the company’s broader turnaround efforts. However, in a letter to employees preceding the call, he emphasized plans to work hard and build a world-class foundry, which may imply that Tan intends to keep the company unified for now.

"Together, we will work hard to restore Intel’s position as a world-class products company, establish ourselves as a world-class foundry and delight our customers like never before," Tan wrote. "That is what this moment demands of us as we remake Intel for the future."

Some employees felt that Tan's remarks lacked enthusiasm and specificity. They had hoped for a clearer strategic plan and stronger reassurance regarding the company's future direction, especially considering his alleged role on Intel's board of directors, which he left in August 2024.

Left with discontent

Tan joined Intel's board in 2022 as part of the company's effort to reclaim its position as a global leader in CPU design and manufacturing. Over time, his role expanded to include oversight of manufacturing operations.

However, eventually, Tan grew increasingly discontent with the company's 'bloated' workforce, which he felt was inefficient and overly bureaucratic, according to Reuters. One of Tan’s major concerns was Intel's approach to layoffs. While Intel announced cuts affecting over 15% of its workforce, Tan believed the reductions were insufficient and should have targeted middle management, which he viewed as a barrier to innovation. He was particularly frustrated that, despite the layoffs, Intel's workforce remained significantly larger than that of competitors like Nvidia and TSMC combined.

Another point of contention was Intel's foundry business. Tan was disappointed by the lack of progress in this area, particularly after a $5.4 billion deal to acquire Tower Semiconductor fell through due to regulatory hurdles in China. Without Tower, Intel lacks the expertise to succeed in contract manufacturing, where it has historically struggled. As a former CEO of Cadence who led the company for 12 years, Tan knows what fabless chip designers need, so now Intel has more chances in the area.

In addition to workforce and foundry issues, Tan was critical of Intel's lagging efforts in AI. Despite multiple attempts and acquisitions to strengthen its AI capabilities, Intel could not keep pace with Nvidia, which became a trillion-dollar company capitalizing on the AI boom.

Analysts and investors cheer

Despite internal worries, investors reacted positively to Tan's appointment. Intel's stock price surged by 15%, opening at $23.80 the following day. Analysts like Stacy Rasgon from Bernstein noted that Tan's longstanding experience in the semiconductor sector lends him significant credibility and could signal hope for Intel's recovery.

Industry analysts believe that Tan's deep-rooted connections and industry knowledge uniquely position him to make the decisions required for Intel's revival. That said, his leadership is seen as a potential catalyst for positive changes, though the path forward may need significant restructuring.

Intel late on Wednesday said it had appointed Lip-Bu Tan as its new chief executive officer effective March 18, 2025. Lip-Bu Tan is a semiconductor industry veteran who served Intel's board of directors from 2022 to August, 2024, when he left allegedly due to disagreements over the company's strategic direction. He was among people who were publicly considered for the role. In addition to becoming the CEO, he will also re-join the BOD. 

"Lip-Bu is an exceptional leader whose technology industry expertise, deep relationships across the product and foundry ecosystems, and proven track record of creating shareholder value is exactly what Intel needs in its next CEO," said Frank D. Yeary, chairman of Intel. 

Tan brings decades of leadership experience, particularly from his time as CEO of Cadence Design Systems between 2009 and 2021. During his tenure, he focused on customer-driven innovation and cultural transformation of the company, which resulted in more than doubling the revenue and a significant growth of margins.

During his tenure at Cadence, he also forged relationships across the whole semiconductor industry that span from foundries to chip designers, which is good news as he understands the needs of Intel's Products division and its customers as well as Intel's Foundry unit and its clients. 

In his remarks, he mentioned both Intel products and existing customers as well as the importance of developing a process technology roadmap, which may imply a  commitment to retain the Intel Foundry unit as part of the company.

"I am honored to join Intel as CEO," said Lip-Bu Tan. "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. 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. 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." 

"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 said. "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." 

Traditionally, Intel was led by executives with an engineering background and the only exception was Paul Otellini, who had a business background and was appointed CEO in the mid-2000s. Tan brings the best of both worlds though. 

Tan's educational background includes a Bachelor of Science in Physics from Nanyang Technological University in Singapore, a Master of Science in Nuclear Engineering from the Massachusetts Institute of Technology, and an MBA from the University of San Francisco. 

Lip-Bu Tan is a well-known investment businessman. Tan's investment firm, Walden International, has backed companies and startups across the semiconductor, alternative energy, and digital media sectors in both the U.S. and Asia. Notable investments include Ambarella, Creative Technology, S3 Graphics, and Sina Corp., the owner of Weibo (a Chinese microblogging platform). 

David Zinsner and Michelle Johnston Holthaus, who served as interim co-CEOs, will continue in their roles as executive vice president and CFO, and CEO of Intel Products, respectively. Frank D. Yeary, who served as interim executive chair, will resume his position as independent chair of the board.

Intel is actively seeking a new CEO following the resignation of Pat Gelsinger, who resigned on Monday. The board is considering several candidates, including former board member Lip-Bu Tan, who stepped down from the Intel board of directions several months ago after disagreements with Pat Gelsinger over how Intel should proceed forward, reports Reuters. 

Gelsinger's oust reportedly came after Intel's board expressed frustration with the slow progress of his efforts to revive the company. Gelsinger was reportedly given the choice to retire or be dismissed. Intel has formed a search committee to oversee the process of selecting its next CEO. While deliberations are still in their early stages, the board is expected to make a final decision in the coming weeks. 

There are several candidates under evaluation. Although no decision has been made, Lip-Bu Tan, a veteran investor in the technology industry and former CEO of Cadence Design Systems, has emerged as a potential candidate. Tan previously played a key role in transforming Cadence into a thriving business and has a lot of respect in the industry (he even has imec's Lifetime of Innovation Award), which makes him a strong contender.  

There is a catch, though: while he has invested in various companies, he has never managed a company of Intel's size that develops its own range of products and produces chips. Also, it is unclear which goals the board has for Intel's next chief executive and how much time they have. Pat Gelsinger served as Intel CEO for 3.5 years, and transforming a company of Intel's size takes a long time. In fact, all the products that Intel has now were developed before Gelsinger's tenure. 

Lip-Bu Tan served on Intel's board for nearly two years after joining it in September 2022 and later taking on expanded responsibilities related to manufacturing operations. During his time on Intel's board, Lip-Bu Tan reportedly clashed with Pat Gelsinger over various issues, including workforce size, the company's strategy for contract manufacturing, and its internal culture. These disagreements eventually led to Tan's departure in August 2023. Despite this, Intel's board has recently reached out to Tan to explore his interest in leading the company, Reuters reports. 

Intel has reportedly declined to comment on the search for Pat Gelsinger's replacement, as the search is a process that is meant to remain confidential. Similarly, Lip-Bu Tan and representatives from his venture capital firm, Walden Catalyst, have not issued any statements. 

According to Reuters reports, Intel's CEO Pat Gelsinger and other key executives are to present their plan to trim Intel's fat and course-correct the company. The meeting will focus on removing assets and reducing costs, with items of discussion apparently including Intel's upcoming Magdeburg, Germany fab and its ownership of Altera.

Intel announced a $1.6 billion loss in its now-infamous August 1 earnings call, which also carried the news that Intel had laid off 15% of its workforce and aims to reduce spending by $10 billion by 2025. The loss came thanks to Intel's falling behind in the AI arms race and its 13th/14th-generation widespread CPU failures. Intel stock had its worst day in 50 years immediately following the call, and the company has continued to suffer in the month since. Chip industry legend Lip-Bu Tan resigned from the board of executives, resulting in a 6% drop in Intel stock and a significant lack of industry experience.

Significant changes to Intel were always likely to reverse this major downturn, but recent reports reveal that Gelsinger's plans may include seriously drastic measures. Construction on Intel's upcoming Magdeburg chip fab is expected to be paused or canceled, leaving the $32 billion project unfinished. Magdeburg's local government has already begun drafting plans in case Intel withdraws its commitment to the project.

Intel is also likely to sell off its ownership of Altera, its programmable chip business, which is currently a fully spun-off company owned solely by Intel. Altera has been an industry fixture for decades, with Intel investing heavily in reviving Altera after acquiring the company in 2015. Altera has been a part of Intel's broad market strategy for ten years but is likely to be entirely sold off to another interested chip manufacturer in the coming months.

Unsurprisingly, Intel is not expected to entertain discussion about spinning off or selling its Intel Foundry wing. Intel's contract foundry business, one of Intel's most significant expenses, has been kept distinct from the rest of Intel's business since Q1 2024 and is considered a tentpole part of Intel's future. Two separate sources have confirmed that Intel will not propose any plans to sell its foundry wing to TSMC or another similar buyer, keeping it around for the day it is hopefully as profitable as Gelsinger believes it can be.

Intel's sharp decline can be attributed to several factors. Lip-Bu Tan reportedly blamed his exit from Intel on a bloated workforce, and Gelsinger blamed expenditures across the board as a major problem. Intel is still mired in issues related to the instability and failure rate of 13th and 14th Generation CPUs, which could lead to permanent chip damage. Tech media heavily reported Intel's lethargic response to a disastrous product failure, leading to increased public distrust of Intel's brand. While selling off companies will help quell Intel's bleeding out; the company has a long road ahead to stability.

Lip-Bu Tan, a seasoned figure in the high-tech industry, has stepped down from Intel's board of directors after two years of service, according to the company's filing with the U.S. Securities and Exchange Commission. His departure, effective immediately, comes at a critical time for Intel as the company faces financial difficulties and implements major organizational changes that involve laying off some 15,000 or more employees.

"I am grateful for the opportunity to serve on the Intel Board of Directors," said Lip-Bu Tan after informing Intel about his decision on Monday. "This is a personal decision based on a need to reprioritize various commitments and I remain supportive of the company and its important work."

SeekingAlpha reports that Intel's stock dropped 6.1% following Intel's announcement of Lip-Bu Tan's departure.

Lip-Bu Tan, a former CEO and the current executive chairman of Cadence, a leading supplier of electronic design automation tools and IP, joined Intel's board of directors in 2022 after the company announced its IDM 2.0 efforts to become a significant contract maker of semiconductors.

Lip-Bu Tan's investment company, Walden International, has invested in semiconductor, alternative energy, and digital media companies and startups in the U.S. and Asia, including Ambarella, Creative Technology, S3 Graphics, and Sina Corp. Sina owns Weibo (a microblogging site in China) and four other business lines. Given Lip-Bu Tan's experience at Cadence and his investment company, he was a treasured board member at Intel.

Intel's board has 12 directors, led by chairman Frank D. Yeary, who spent his entire career in the financial industry. In fact, among the board of directors of Intel, two have an academic background in electrical and computer engineering and experience in a semiconductor company; one has worked in the PC industry; and two—Pat Gelsinger and Stacy Smith—are either existing or former executives at Intel. Others have worked outside of the semiconductor industry.

Intel's stock tumbled by about 30%, erasing around $39 billion in market capitalization in just a few days, from late July to early August. On July 31, Intel's market cap was $130.86 billion at the close of the NYSE. After reports of massive layoffs, it dropped to $123.96 billion on August 1. Following Intel's financial report and a substantial $1.6 billion loss, the valuation fell further to $91.86 billion. Intel's current market cap at press time is $88.43 billion, highlighting that the company has lost over half its market value since the beginning of the year.

Graphcore, a U.K.-based artificial intelligence (AI) processor developer, is considering its strategic options. The company is facing difficulties raising money from investors and may be seeking a buyer for a deal worth around $500m (£400m), reports The Telegraph. Among the potential purchasers the newspaper names Arm, OpenAI, and Softbank, though none of these entities confirmed any talks with Graphcore.

Despite raising over $700 million from investors like Microsoft and Sequoia (with a massive valuation at $2.8 billion as of late 2020), Graphcore has struggled to become a viable player on the market of AI processors with its intelligence processing units (IPUs), partly due to closure of its China business due to U.S. AI technology restrictions last year. 

The company reported an 11% increase in losses ($204.6 million in 2022), with revenue dropping from $5 million to $2.7 million, according to The Telegraph. The company has taken measures to cut costs in response to its financial challenges, which included staff layoffs and closing international offices. To continue operations and compete in the AI chip market, Graphcore needs to raise more funds by May 2024. These funds may come from existing investors, or a buyer. 

Rumored interested parties include Arm, SoftBank, and OpenAI, but no official statements have been made. The sale might face scrutiny from national security officials due to the strategic importance of AI technology. 

Meanwhile, Chrysalis, a London-listed fund with a Graphcore stake, revealed in December that one of its a portfolio companies was in process of being sold. Soon after, it sharply raised its Graphcore stake's value, hinting at a sale, according to Zeus Capital analysts. This adjustment implied Graphcore's valuation at $528 million, based on an investor's estimate. Baillie Gifford, another Graphcore investor, also upped its valuation of Graphcore.

Graphcore got into headlines in 2020, when it released its Colossus MK2 GC200 intelligence processing unit (IPU) that featured 59.4 billion transistors and was the industry's most complex chip at the time. Each GC200 IPU packs 1,472 independent IPU cores with SMT that can handle 8,832 separate parallel threads and carries 900 MB of SRAM with an aggregated bandwidth of 47.5 TB/s per chip (eliminating need for external memory) as well as 10 IPU links to scale-out with other GC200 chips. From performance point of view, each GC200 offers up to 250 FP16 TFLOPS, which is comparable to Nvidia's A100's 312 FP16 TFLOPS (yet lower than 624 FP16 TFLOPS with sparsity), but the market did not bite. 

Masayoshi Son, the founder of SoftBank Group, plans to raise $100 billion for a new chip venture called Project Izanagi, aiming to rival Nvidia in artificial intelligence processors, reports Bloomberg, citing sources with knowledge of the matter. Son envisions this initiative as contributing to the development of artificial general intelligence (AGI), leading to a future where machines surpass human intelligence.

The project seeks to complement SoftBank’s Arm Holdings, which designs processor architectures. But it is unclear whether the AI processors designed by Project Izanagi will rely on technologies such as instruction set architecture (ISA) developed by Arm. Furthermore, how the venture will co-exist with Arm’s purported plans to create reference chip designs for various workloads remains to be seen. An interesting wrinkle is that the venture is named after the Japanese god of creation and life, reflecting Son’s ambitious vision for the project.

Building a company that could compete against Nvidia successfully is challenging. The green company not only has plenty of talented hardware engineers and highly competitive hardware, but it also has a ubiquitous CUDA software stack. It is tough to compete against something that has been evolving for well over 16 years now.

Project Izanagi is part of Son’s broader focus on AGI, which he believes will be realized within the next decade. He has consistently advocated for adopting AI, leading to a safer, healthier, and happier world. Son’s enthusiasm for AGI is intense, to say the least, despite facing numerous setbacks in his startup investments. He told a group of Japanese enterprise clients to embrace AI or risk being left behind, emphasizing the transformative potential of AGI.

“AGI is what every AI expert is after,” Son is reported to have said by Bloomberg. “But when you ask them about a detailed definition, a number, the timing, how much computing power, how much smarter AGI is than the human intelligence, most of them don’t have an answer. […] I have my own answer: I am convinced AGI will be real in 10 years.”

SoftBank’s financial position is strong, with ¥6.2 trillion ($41 billion) in cash and cash equivalents as of December 31. According to the report, Son intends to invest $30 billion from SoftBank, with the remaining $70 billion potentially sourced from Middle Eastern institutions. The specifics of the funding and execution are still being determined, and the project may evolve further as plans solidify, according to Bloomberg. Son’s approach to investment is dynamic, and he is known for abruptly changing his mind.

The initiative is separate from any collaboration with OpenAI’s Sam Altman, although Son and Altman have reportedly discussed joining forces in semiconductor manufacturing.