Massive layoffs at Intel? New CEO Lip-Boo Tan prepares for tough decisions

Intel's new CEO Lip-Boo Tan is weighing radical changes to overhaul the company. Before returning to the company, the CEO has charted significant enhancements to chip production and the Artificial Intelligence (AI) strategy. His aim is to revitalize Intel's manufacturing operations, so that the company can create a competitive advantage. He has informed the employees that the company will need to make tough decisions.

Plans to enhance manufacturing and management

The new CEO of the company is developing new plans to enhance the performance of Intel's manufacturing division, Intel Foundry. Previously, this division produced chips for Intel alone, but now it has also been involved in producing chips for other companies like Nvidia and Microsoft. Plans are being developed to bring in more customers in this segment.

Strictness on middle management

In the opinion of semiconductor industry analyst Dylan Patel, Intel has to enhance its middle level of management on a massive scale and the CEO can make huge strides in this regard.

Growing into AI and other domains

With this, the new CEO of the company is also going to rework Intel's AI strategy. The firm will not only operate in the server market but also invest more in segments like software, robotics, and AI foundation models.

Impact in the Economy and Market

Intel lost Dollar 19 billion in 2024, their first loss since 1986. They are investing in new plants in the US and Europe, which will make Intel more dominant in the market. Gelsinger wanted to turn Intel into a contract chip maker so that the company could rival firms like TSMC. These plans had to be reduced because of the decline in the market. Now the CEO has understood the weaknesses of this plan and is going to execute it in a better way.