Struggling chipmaker Intel sees shares jump 12% as it names new CEO to end 3-month suspense

Struggling chipmaker Intel, once a leader in the semiconductor industry, has appointed former board member and semiconductor expert Lip-Bu Tan as its new CEO. This could be seen as an effort to revive the once-dominant company.

After the development, the tech giant’s shares saw a massive rally and rose by 12 per cent.

Tan, 65, will take charge next Tuesday, over three months after former CEO Pat Gelsinger suddenly retired amid financial troubles, mass layoffs, and concerns over Intel’s future as an independent company.

“Lip-Bu is an exceptional leader whose technology industry expertise, deep relationships across the product and foundry ecosystems, and proven track record of creating shareholder value is exactly what Intel needs in its next CEO,” Intel’s interim Executive Chairman, Frank Yeary, said.

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Tan brings extensive experience in the semiconductor industry. He previously served as CEO of Cadence Design Systems, a company that develops software for designing processors. He was also a member of Intel’s board from 2022 until August last year. Along with his new role as CEO, he will rejoin Intel’s board.

Gelsinger’s time as Intel’s CEO fell short of expectations, with the company’s stock dropping 60 per cent and erasing $160 billion in shareholder value.

Job cuts, financial distress jolts Intel

Last year, Intel cut 17,500 jobs—about 15% of its workforce—and halted its dividend to save costs. The company also reported an annual loss of $19 billion last year.

Chip factories opening delayed

Recently, Intel delayed the opening of two new chip factories in Ohio, citing the need for financial responsibility. The project is set to receive $7.8 billion in funding from the CHIPS Incentives Program, launched under President Joe Biden’s administration.