Incoming Intel CEO Tan planning manufacturing, AI overhaul - report
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Intel's incoming chief executive Lip-Bu Tan has reportedly considered significant changes to the company’s chip manufacturing methods and artificial intelligence strategies ahead of his return to the company on Tuesday.
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Reuters cited two people familiar with Tan's thinking as saying that the new trajectory includes restructuring the company's approach to AI and staff cuts to address what Tan views as a slow-moving and bloated middle management layer.
It was understood that revamping the company's manufacturing operations, which at one time only made chips for Intel but have been repurposed to make semiconductors for outside clients such as Nvidia, is one of Tan's core priorities.
According to Reuters sources, at a town hall meeting following his appointment as CEO last week, he told employees that the company will need to make "tough decisions”.
Semiconductor industry expert Dylan Patel said a big problem under former Intel CEO Pat Gelsinger, who left the company in December, was that he was "too nice." "He did not want to fire a bunch of middle management in the way they needed to," he said.
It was understood that in the near term, Tan aims to improve performance at Intel’s manufacturing arm, Intel Foundry, which makes chips for other design companies such as Microsoft and Amazon, by aggressively wooing new customers.
It will also restart plans to produce chips that power AI servers and look to areas beyond servers in several areas such as software, robotics and AI foundation models.
"Lip-Bu will be spending a lot of time listening to customers, partners and employees as he comes on board and works closely with our leadership team to position the business for future success," an Intel spokesman said in a prepared statement to Reuters.