Intel CEO makes bold decision to save empire, accepts billions of dollars in losses

(Dan Tri) - Lip-Bu Tan, who was recently appointed as CEO of chip company Intel, made a bold decision to accept a loss of up to billions of dollars to help revive the company.

Reuters quoted unnamed sources from within Intel as saying that the company's CEO Lip-Bu Tan is making a major change to its contract chip manufacturing operations to attract more large customers.

Intel's new strategy for its contract chip manufacturing operations will include offering next-generation manufacturing processes, with more advanced technology, to customers.

This is considered Intel's move to compete with the world's largest chip manufacturer, TSMC, to attract major customers such as Apple and Nvidia.

Lip-Bu Tan accepted a huge loss to completely change the strategy of the previous CEO, to help Intel overcome the prolonged crisis (Photo: Tipranks).

Since taking the CEO seat at Intel in March, Lip-Bu Tan has quickly taken drastic measures to cut costs and find a new direction to revive this struggling company.

By June, CEO Lip-Bu Tan began expressing his view that the chip manufacturing process known as 18A, which previous CEO Pat Gelsinger had invested heavily in developing, was losing its appeal to new customers, the source said.

The 18A manufacturing process cost Intel billions of dollars to develop. However, CEO Lip-Bu Tan is willing to accept losses of hundreds of millions, even billions of dollars, to replace 18A with a new, more modern chip manufacturing process.

Lip-Bu Tan wants Intel to focus more on 14A, a new-generation chip manufacturing process that Intel expects to gain more advantages over Taiwan's TSMC, sources said.

Lip-Bu Tan expects that when the 14A process is officially put into production, Intel can become a chip manufacturing partner for Apple and Nvidia. Currently, these two technology companies are customers of TSMC.

Intel declined to comment on the Reuters report. The company said the 18A process is being used to manufacture its own “Panther Lake” laptop chips, which are expected to launch later this year. Intel said it is confident that this will be the most advanced processor ever designed and manufactured in the United States.

Intel is currently facing numerous difficulties as it lags behind in the race to develop mobile chips and artificial intelligence chips, as well as gradually losing market share in the computer chip market, as Apple switches to using its own computer chips.

Intel was forced to shift to contract chip manufacturing, but still cannot compete with TSMC or Samsung.

Last year was Intel's first loss since 1986. The company recorded a net loss of $18.8 billion in fiscal 2024.

With the appointment of Lip-Bu Tan as CEO, Intel's board of directors expects him to be able to lead and leverage his relationships to find major customers.

Of course, Intel also needs to demonstrate its own manufacturing and technological capabilities to meet the growing demands of potential partners.

Source: https://dantri.com.vn/cong-nghe/ceo-intel-ra-quyet-dinh-tao-bao-de-cuu-de-che-chap-nhan-lo-hang-ty-usd-20250703124049685.htm