Looking back at his career, Lip-Bu Tan shares a history of being the transformatory force behind ailing companies. During the struggling times of Cadence Design Systems, he pulled top gear by doubling its sales and sending its share price soaring by more than 3,200 percent. At Intel until August 2024, he called it quits saying its a ‘bloated workforce’ and a culture he perceived as slow. Returning back as its new CEO, Tan plans to cut down inefficiencies and refocus its direction after having lost $18.8 billion last year and lost ground to competitors like Nvidia and AMD. His news was welcomed with cheers in the Investor community, which, during Wednesday's after-hours trading, bid up Intel's shares by over 10 percent. As his first move, Tan wrote a letter to Intel's employees, promising to transform the company into an ‘engineering-focused company’ that keeps its word and listens to its customers. What does it all imply? Will there be a meaner and leaner Intel soon? Nevertheless, it looks like a rumble is upon the chipmaker giant with the new CEO.
He is No Stranger to Transforming Companies from the Bottom Up
Tan is perhaps one of the most influential tech leaders, lesser known to the world. He is a veteran of the semiconductor industry who has more than a decade of experience at Cadence Design Systems in his track record. He is no stranger to the business, especially in running a company as big, intricate, and distinctive as Intel.
His Friend List Include Nvidia and AMD’s Leaders
He is well-known by the majority of Intel's current and future clients who share experience doing business with him either by buying software from a company he headed or by investing in one of the several startups he backed. In his friend circle, Tan is said to be quite familiar with powerful individuals like Lisa Su from Advanced Micro Devices and Jensen Huang from Nvidia, who were reportedly approached to invest in Intel. Clearly, he has a bigger advantage that is not much known to the general public.
He is Known for His Proactive Approach
The US President Donald Trump, who is keen for Intel to recover, is also likely to be closely monitoring his efforts. Like he did in the past to turn around small businesses that eventually grew into major corporations, Tan might employ underdog strategies or a proactive approach to bring back to life the largest ship in the semiconductor industry.
Turning around the operations of a corporation that placed the "silicon" in Silicon Valley is a huge undertaking for Tan, the newly appointed CEO of Intel.
He is a Strategic Investor
Tan holds specialization in artificial intelligence, cloud computing, data security and management, and semiconductors. He is known for pouring dollars in several startups as he believes that relatively small teams of startup engineers with strong semiconductor design concepts could successfully fight against established chip giants.
He Makes Startups Either a Potential Competitor or Target of Acquisition
For instance, he has invested in Annapurna Labs, a business that Amazon.com eventually acquired for $370 million and which now serves as the core of its in-house chip division. According to Amazon, it currently uses more of its own central processors than Intel ones. After that he has invested in Nuvia, which Qualcomm acquired for $1.4 billion in 2021 as a key component of its strategy to take on Intel in the laptop and PC chip industries.
To this day, Tan remains actively involved with startups that may either end up competing with Intel or become targets for acquisition. Even recently, he made an investment in Celestial AI, an AI photonic firm supported by Advanced Micro Devices, a rival of Intel.
His Contributions
During his time at Cadence Design Systems from 2009 until 2021, Tan worked closely with TSMC, which had pledged from the beginning that it would only focus on production, and on providing the software for complex designs for the company.
As the iPhone manufacturer moved away from vendors like Intel and toward its own chips, Cadence's share increased 3,200 percent during Tan's tenure there, and Apple became one of its biggest clients.
Additionally, Cadence's products were essential to companies in the semiconductor sector like Broadcom, which assists Google, Amazon, and others in designing their own AI chips and having TSMC manufacture them. Tan also served on the boards of SoftBank Group and Hewlett Packard Enterprise.
The Biggest Task He Has to do at Intel
With missed opportunities and financial pressures, the past year has been quite the rollercoaster for Intel. Tan is aware of this and that the reversal will not be simple. However, his message is also positive. He believes that Intel has "what it takes to win," emphasizing the company's engineering history and capacity for self-reinvention. Perhaps this balance of confidence and modesty is just what Intel needs right now.
Tan will be the fourth CEO of Intel. He has been on the board of directors of Intel before, and is not exactly an outsider to the corporation. Also, he has a broad range of skills that include both designing and manufacturing AI chips.
Choosing whether Intel is a chip design firm or a chip manufacturing company would likely be one of Tan's toughest jobs as the new CEO.
That is, whether to make it into an AI chip company or a PC and server chip company?
But considering his experience of working closely with semiconductor fabrication facilities during his tenure at Cadence, Tan knows both the design and manufacturing aspects of the chip industry like the back of his hand.
He is Inheriting the Same Approach With a Little Twist
He is said to take over Gelsinger's Intel foundry approach. It is believed to be an attempt to turn Intel into a contract manufacturer for more than only its own ideas. He is likely indicating that he will continue but will modify the way it is carried out. Accelerated investment in US-based operations could be part of the Intel CEO's foundry plan, giving the company a manufacturing advantage over competitors like TSMC.
Also Read: Lisa Tzwu-Fang Su: The Woman Leader Powering the Future of Computing
The arrival of Lip-Bu Tan marks a turning point for Intel. His commitment to creating a top-notch foundry and putting the needs of his customers first marks a shift in focus that could have far-reaching effects. Even while challenges lie ahead, his leadership and vision give the venerable chipmaker a renewed sense of purpose and hope. The tech community will be intently observing Tan's ability to bring Intel back to its former glory and establish the company's place in the rapidly changing technology sector.