Intel shares surged 10% in pre-market trading after Wall Street backed the decision to appoint Lip-Bu Tan as CEO. Tan, a former board member of the company, resigned in August due to disagreements over the chipmaker\u2019s development strategy. The decision comes amid Intel\u2019s prolonged underperformance in the market.<\/p>\n\n\n\n
Tan faces the challenge of reviving the company\u2019s position after it missed the semiconductor boom driven by artificial intelligence and spent billions of dollars developing its own manufacturing business. In recent years, Intel has lost market share in the data center and personal computer segments, while its manufacturing division has suffered billion-dollar losses. Overall, Intel\u2019s stock has lost about 60% of its value in the past five years, while the Nasdaq Composite and S&P 500 have more than doubled in the same period.<\/p>\n\n\n\n
Analysts at TD Cowen described Tan\u2019s appointment as \u201cthe best stakeholders could have hoped for,\u201d highlighting his \u201cdeep industry connections\u201d that could help attract customers to Intel\u2019s contract manufacturing business.<\/p>\n\n\n\n
Tan will assume his role next week, three months after the resignation of former CEO Pat Gelsinger. He joined Intel\u2019s board two years ago to assist with the company\u2019s transformation but left due to disputes over personnel policies and corporate culture.<\/p>\n\n\n\n
Skepticism about Intel\u2019s future has grown in recent months following reports that competitors, including Broadcom, considered acquiring its chip development and marketing divisions, while TSMC explored options for managing some or all of Intel\u2019s manufacturing operations.<\/p>\n\n\n\n
Analysts expect Tan to continue Gelsinger\u2019s strategy of keeping both chip development and manufacturing under one roof. In a letter to employees, Tan pledged to make Intel a leading foundry\u2014a term referring to a contract chip manufacturer. However, experts warn that attracting customers to this business could be difficult, as chip designers may be reluctant to entrust production to a potential competitor.<\/p>\n\n\n\n
Nonetheless, Tan has a strong reputation as a \u201cneutral player\u201d due to his experience at Cadence Design Systems, which supplies chips and design software. Analysts believe this could help Intel address some strategic challenges.<\/p>\n\n\n\n
Bernstein analyst Stacy Rasgon noted that Tan\u2019s prior board experience gives him an advantage: \u201cIt allowed him to gain deep insight into Intel\u2019s internal problems, and he likely has a more realistic perspective than his predecessors. Gelsinger\u2019s excessive optimism ultimately proved to be his biggest mistake.\u201d<\/p>\n\n\n\n
However, the transformation process is expected to take several years, a point Tan hinted at in his address to employees.<\/p>\n\n\n\n
Last year, Intel\u2019s market capitalization fell below $100 billion for the first time in three decades as its stock lost 60% of its value. Additionally, sales of Gaudi AI chips fell short of targets.<\/p>\n\n\n\n
More analysts are advising investors to sell Intel stock rather than buy it, with most experts rating the company\u2019s shares as \u201chold,\u201d according to LSEG data.<\/p>\n\n\n\n
\u201cTan faces a massive challenge, and there is much work to be done. However, something needs to change to give investors a clearer signal to act. If he fails, the situation may become irreparable,\u201d Rasgon concluded.<\/p>\n","protected":false},"featured_media":4719,"template":"","class_list":["post-4718","news","type-news","status-publish","has-post-thumbnail","hentry"],"acf":[],"_links":{"self":[{"href":"https:\/\/thorex.site\/en\/wp-json\/wp\/v2\/news\/4718","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/thorex.site\/en\/wp-json\/wp\/v2\/news"}],"about":[{"href":"https:\/\/thorex.site\/en\/wp-json\/wp\/v2\/types\/news"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/thorex.site\/en\/wp-json\/wp\/v2\/media\/4719"}],"wp:attachment":[{"href":"https:\/\/thorex.site\/en\/wp-json\/wp\/v2\/media?parent=4718"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}