On March 31, at his first public appearance as CEO during the Intel Vision conference in Las Vegas, Lip-bu Tan outlined his strategy for Intel, which includes spinning off non-core assets, enhancing AI-related products, and collaborating with the US government to attract 2 to 3 key customers for its foundry business.
Organizational and operational reforms
During the event, Tan said that Intel plans to redefine its strategy by prioritizing its core business and leveraging AI and software 2.0. This will involve spinning off non-core operations and shifting from an inside-out approach to a model that integrates software development from the start.
Tan emphasized investing in people and ideas to drive innovation while reducing bureaucratic obstacles. He highlighted the importance of small, focused teams that move quickly and compete with incumbents, a strategy he aims to implement at Intel. While acknowledging initial challenges, he is committed to perfecting this approach over time. He believes this will unlock his team's potential, attract new talent, and help shape a new Intel. He also encouraged interested individuals to reach out to him directly.
"I will also put resources behind people and ideas, where we can see the opportunity to innovate," said Tan, adding that Intel will simplify the way it works as bureaucracy kills innovation.
Work with US government to rebuild foundry business
Tan reaffirmed his commitment to strengthening Intel's products while building a competitive foundry business. He highlighted the growing global demand for semiconductor manufacturing and the need for flexible, resilient, and secure supply chains, positioning Intel Foundry as a key player in meeting these requirements.
Tan emphasized that the foundry business is built on trust and must accommodate the unique design methodologies of different customers. He stressed the importance of understanding customers' preferred IP vendors and EDA partners to optimize performance, quality, and yield without imposing changes. Given his deep experience in this ecosystem, he is actively working to advance Intel's foundry strategy.
He noted Intel's continued progress on its 18A and upcoming 14A process nodes, with 18A set for high-volume production in the second half of the year, starting with Panther Lake. He acknowledged that improving yield, quality, and customer service will take time, but is confident that securing two or three key customers will help drive performance and yield improvements.
"We'll continue to advance our 18A as well as our future note 14A. 18A is set to win high-volume production in the second half this year with Panther Lake," said Tan, adding, "It will take some time. I'm very patient. And very important for me, you need two or three very important customers."
Tan also underscored Intel's unique position as the only US company designing and manufacturing advanced chips, making it a critical player in the foundry ecosystem, particularly within the US. He expressed appreciation for the Trump administration's focus on strengthening American technology and manufacturing leadership and indicated his willingness to engage with policymakers to support Intel's goals.
"They're asking me, what can we help? And definitely, I will come to get their help to do what we need to do," said Tan.
Tan noted that he will talk more about the Intel Foundry at Intel's Direct Connect event at the end of April.
Tan on IC design
Tan emphasized that having the best products is crucial for success and that his team has been refocusing on this priority since last year. He outlined three key non-negotiable areas: delivering high-performance solutions that anticipate future workloads, ensuring efficiency to support AI within power constraints, and maintaining top-tier quality with strict on-time delivery. He acknowledged current power limitations in AI cloud infrastructure and stressed the need for a "first-time pass" culture, which he intends to implement.
"We must deliver great quality, on-time delivery without exception, and we have to have a culture of first-time pass, and we're not there, and I will implement that," said Tan.
Double down on AI chips using AI
Intel plans to utilize an AI-driven system design to accelerate the development of a new compute architecture platform. Tan, drawing from experience with Cadence, recognizes that the adoption of AI can lead to significant improvements in performance and power efficiency, exceeding double-digit gains. This transformation is poised to be a game-changer, enhancing customer productivity in their design processes.
Additionally, Intel will facilitate the development of new compute-intensive models, applications, and agents that will be enjoyed in the coming years.
Pragmatic reset over bold claims
According to Bloomberg Intelligence, Tan's Vision keynote lacked major news or specific targets, but his honest approach and emphasis on repairing engineering teams and customer trust indicated a pragmatic reset. His leadership is expected to foster leaner execution, cost discipline, and a sharper focus on customers, particularly in Intel Foundry. This shift from bold ambition to practical rebuilding may provide a stronger foundation for a turnaround, although execution will be crucial.
Article edited by Jack Wu
