Trump demands immediate resignation of Intel CEO, who has been in office for only 4 months
In a post on Truth Social, President Donald Trump said that Intel CEO Lip-Bu Tan is "very conflicted" and should resign, immediately. There are no "buts" - "it's the only solution," he adds. Unsurprisingly, Intel shares immediately fell by more than 3%.
This came on the heels of Senator Tom Cotton's address to Intel's board of directors, raising questions about a potential conflict over Tan's investments in Chinese companies, some of which have links to the Chinese military-industrial complex.
This is perhaps the worst possible time for Intel to receive such a blow from the state. Lip-Bu Tan took over the position only on 18 March this year. The company's board of directors replaced Pat Gelsinger due to the company's extremely poor financial performance and even the threat of bankruptcy.
As CEO, Lip-Bu Tan announced that the abandonment of Hyper Treading technology in the Core-100 and Core-200 processors was a mistake and that the technology should be brought back. He also initiated a number of business units and headcount cuts. He announced that by the end of 2025, 15% of Intel's employees would leave, and the construction of new factories in Germany and Poland was cancelled. Even the development of artificial intelligence is now on hold. Lip-Bu Tan said that the company should first develop a holistic, closed-loop strategy, including hardware and software solutions, rather than rushing to create chips.
At the same time, Lip-Bu Tan is known for his active cooperation with Chinese technology companies. Until 2013, he was the president of Cadence Design Systems for 13 years, which was recently found guilty of violating US trade restrictions. Cadence Design Systems sold hardware and software technologies to the National University of Defence Technology of China without a licence. Lip-Bu Tang himself is an active investor and continued to invest in Chinese technology companies even while he was already CEO of Intel.
This is of great concern to the US government, even more so in economic terms than in military terms. The fact is that under the CHIPS Act, Intel alone has received nearly $8 billion in subsidies from the US federal budget, the largest amount ever paid to a single company in history. Given Trump's policy of pressuring companies to move production to the US, Tan's outlook could be seen as a betrayal.
Intel released a statement emphasising that the company's management has no doubt about its CEO's patriotism, as Lip-Bu Tan is deeply committed to the national security of the United States.
It is clear that crisis management talent is difficult to assess in such a short period of time. Therefore, it can be very painful for the company to "change horses in the middle of the race". There is no worse time to cancel reforms that have not been completed and start new ones. In this case, there will be no one to blame, and if things go badly, everyone will blame their predecessor. We hope that politicians will slow down a bit and Intel will emerge from this critical period.
Source: gizmodo.com
