Barely months into the job, Tan is locked in a slow-burning battle with Chipzilla chairman Frank Yeary and a faction of directors over the core question of whether Intel should remain in the chip manufacturing business at all. The division, responsible for a third of the company’s revenue, is its most expensive mistake. Some on the board want it binned. Tan doesn’t.
Yeary even floated spinning the whole thing out and handing pieces of it to Nvidia and Amazon. Another version of the scheme involved flogging it to TSMC. Neither got anywhere but stalled everything else.
Tan insists the foundry is strategically critical. If Chipzilla walks away, he argues, the US will be left begging foreign outfits like TSMC and Samsung to keep the lights on. The board appears more interested in cutting costs and punting decisions down the road.
According to the Wall Street Journal, a capital raise designed to bolster fabrication investments has been mothballed by the board until 2026. The same thing happened to an AI acquisition meant to close the gap with Nvidia and AMD. Another bidder is now circling while Chipzilla dithers.
Internally, the frustration is palpable. “There are no more blank checks,” Tan told staff in a recent memo. “Every investment must make economic sense.” That came alongside a 15 per cent workforce cull and the shelving of chip factory plans in Europe and a slowdown in the Ohio project.
The internal deadlock is a mess of bruised egos and clashing strategies. Tan’s critics on the board want to take things slowly, sell off problem parts, and let others do the heavy lifting. Tan wants to build and buy his way out of irrelevance before the next AI wave leaves Chipzilla for dead.
It doesn’t help that his predecessor, Pat [Kicking] Gelsinger, had started currying favour with the new White House crew before stepping down. Tan, who abruptly quit the board months earlier after falling out with Gelsinger and Yeary, inherited a divided table, not a united front.
Officially, the board says it’s aligned with Tan. Unofficially, it’s tying his hands and then blaming him when nothing moves.
