Jim Keller says a 'great Intel' is worth $1 trillion, company would be sold at fire sale pricing if sold now

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It is better to take the company private and retain its IDM nature.

Tenstorrent
(Image credit: Tenstorrent)

Ex-Intel lead silicon engineer Jim Keller says Intel may not make as much money as it used to earn historically, but selling the company or some of its businesses is not a way to unlock shareholder value, but rather a fire sale of a company that has high chances to prosper. Jim Keller, a legendary chip designer and now the chief executive officer of Tenstorrent, a promising AI processor developer, took to Twitter to express his views on the latest news of a potential split or sale of Intel. 

"You build value by having a great goal and a team that loves working to the goal," Keller wrote in an X post. "Intel built the fastest CPUs on the best process [technologies]. This [Handling Intel's businesses to third parties] is not unlocking shareholder value, it is a fire sale. It makes me sad."

"[…] I think a great Intel is worth $1 trillion. Seems a little careless to throw it away," he added later.  

The latest rumors indicate that Broadcom could be interested in taking over Intel's products business, whereas the Intel Foundry unit could form a joint venture with TSMC or even with a conglomerate involving TSMC, Broadcom, Qualcomm, and other companies that would inject money into a new independent chipmaker. 

One commenter in the thread suggested that a better outcome for Intel would be to become a private company with the help of American investors, fire the current board of directors, and then take the time to reinvent Intel. 

"It would be hard but doable," Keller wrote in another post. "Humans are amazing when they have a great goal and a team they believe in." 

The current U.S. government will unlikely support Intel's fabs being run by TSMC or other foreign entities, even though the Trump administration encourages domestic manufacturing. However, if Intel gives up its own manufacturing, it will not only cease to be an integrated device manufacturer (IDM) but also lose one of its strong points: complete control over products and their manufacturing. Also, it's unlikely that TSMC and other potential investors will be tremendously interested in investing in Intel Foundry, which bleeds money as it has yet to land orders from major companies. 

However, companies with deep pockets, such as Broadcom, could take over Intel's products division to gain CPU capability and world-class product design teams. However, a change of Intel ownership automatically terminates the company's broad cross-licensing agreement with AMD. This means the new entity could lose access to innovations developed by AMD and shared between companies as part of their broad cross-license agreement unless a new agreement is inked.

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Anton Shilov
Anton Shilov
Contributing Writer

Anton Shilov is a contributing writer at Tom’s Hardware. Over the past couple of decades, he has covered everything from CPUs and GPUs to supercomputers and from modern process technologies and latest fab tools to high-tech industry trends.

39 Comments Comment from the forums
  • bit_user
    The article said:
    if Intel gives up its own manufacturing, it will not only cease to be an integrated device manufacturer (IDM) but also lose one of its strong points: complete control over products and their manufacturing.
    Right now, that exists only for their server products. It went out the window for client CPUs with Meteor Lake and they never had it for GPUs.
    Reply
  • watzupken
    It may be worth "1 trillion bucks" but this is clearly not the value now. Taking it private sounds like a great plan, but is also a great way to make the individual poorer each day. I am not saying it is not possible, but more around the willingness to pay for something that is a heavy financial burden with no turnaround possible in the mid term given that Intel does not have a healthy list of clients using their fabs.
    Reply
  • TommyCC
    Intel cannot make another mistake like hiring the like of Gelsinger, who bragged about 4 process nodes in 5 years. If Intel can find another Lisa Su, it might work.
    Reply
  • Pigpig
    TommyCC said:
    Intel cannot make another mistake like hiring the like of Gelsinger, who bragged about 4 process nodes in 5 years. If Intel can find another Lisa Su, it might work.
    Pat is doing good actually, intel 18a is nice, but intel board cannot wait anymore…. The problems should be intel ex ceo who refused to buy EUV and keep stuck in 14nm technology.
    Reply
  • rluker5
    TommyCC said:
    Intel cannot make another mistake like hiring the like of Gelsinger, who bragged about 4 process nodes in 5 years. If Intel can find another Lisa Su, it might work.
    OK they will get just 4 nodes in 4 years since they decided to outsource 2nm to focus on 1.8nm. And how well did that outsourcing work for them?
    Apparently the most node progress in the world at this time is a miserable failure to you. What has TSMC done in comparison over the same time span? 3nm, 3nm+, 3nm++?
    Meanwhile Lisa Sue can only do what Intel did with 2nm when it comes to manufacturing.

    I'm looking forward to seeing how well 18A does later this year, but more so on unlocked desktop chips.
    Reply
  • bit_user
    watzupken said:
    Taking it private sounds like a great plan,
    The risk is that private investors stop developing new nodes and just milk the existing ones. That's like page 1 of the private equity playbook. The US government would need to create some incentive to keep them doing new node development. Maybe along the lines of CHIPS, or some kind of equivalent tax breaks + interest-free loans, etc.

    watzupken said:
    given that Intel does not have a healthy list of clients using their fabs.
    There's an upside to a spinoff of their fabs, which is that it should be easier for them to attract big clients, the more distance they can put between themselves and the design side of Intel.
    Reply
  • bit_user
    rluker5 said:
    Meanwhile Lisa Sue can only do what Intel did with 2nm when it comes to manufacturing.
    I'm not really sure what you mean by this, but what's ironic about her leading a fabless company like AMD is that she came up through the fabrication side of Texas Instruments & IBM's semiconductor business and certainly knows a lot more about lithography than about CPU design.
    Reply
  • nogaard777
    TommyCC said:
    Intel cannot make another mistake like hiring the like of Gelsinger, who bragged about 4 process nodes in 5 years. If Intel can find another Lisa Su, it might work.
    What are you smoking? Intel made MASSIVE gains in it's process nodes under Gelsinger. In those 5 years Intel went from the 14nm+++++++ nightmare and way behind TSMC to actually being ahead again. Hiring Gelsinger put Intel back on track. Firing him is the mistake that tells you it's still the same old Intel run by idiot investors that think changing CEOs more often than toilet paper will bring instant profits.
    Reply
  • bit_user
    nogaard777 said:
    Intel made MASSIVE gains in it's process nodes under Gelsinger. In those 5 years Intel went from the 14nm+++++++ nightmare and way behind
    A lot of that was already baked in the cake, by the time he started. Most of the stuff that Gelsinger deserves credit for is just starting to see the light of day.

    I'm not too sure about Intel 3. Maybe @jkflipflop98 can say if he feels Gelsinger had much impact on it.

    nogaard777 said:
    Hiring Gelsinger put Intel back on track. Firing him is the mistake that tells you it's still the same old Intel run by idiot investors that think changing CEOs more often than toilet paper will bring instant profits.
    IMO, we should go back to a higher tax rate on short-term capital gains. That would incentivize investors to be more long-term focused. That influences board composition and their decisions, such as this one.
    Reply
  • ekio
    Just like my company.
    It’s worth 100k but it could be worth 100 Milions in an hypothetical future where I miraculously suddenly do everything perfect.

    Intel is worth not much because their x86 advantage is dying, their GPU are waay behind Nvidia and AMD, their fabs are never going to beat TSMC and they sold their diversified portfolio to stay afloat, and their brand is not anymore synonymous with champion but with falling behind.

    I think thais comment is just a courtesy from JK for his friends there who are sinking.
    Reply