In March of this year, Lipu Tan, who became the CEO of Intel, said, "Intel is no longer among the top 10 semiconductor corporations," expressing a voice of introspection. Although it once led the semiconductor industry as a top player, the company has continued to struggle in areas such as Central Processing Unit (CPU) and foundry businesses. This statement is analyzed as a call to alertness for employees due to the ongoing decline. CEO Tan is expected to accelerate Intel's recovery of competitiveness by significantly revising its business strategy in areas such as artificial intelligence (AI) semiconductors and foundry operations.
According to reports from Reuters and other foreign media on the 11th, CEO Tan recently told employees, "20 to 30 years ago, we were leading the industry, but now we are not." He noted, "The world has changed, and we have become a corporation that cannot even enter the top 10 in the semiconductor ranking. The gap has widened too much to catch up with leading AI companies like NVIDIA." In response, Intel explained that it was "not a comment about technological capabilities, but a statement regarding the current market value of the corporation."
Intel is currently facing multiple challenges, including intensified competition in the PC semiconductor market, a downturn in AI semiconductor business, and significant losses in its foundry operations. Industry experts point out that the gap with competing corporations is widening, and problems are difficult to resolve in a short time due to the entrenchment of business organization, technological roadmap, and corporate culture centered around existing core businesses, such as CPUs. Consequently, Intel is undertaking a major restructuring to prevent massive losses. Since April, CEO Tan has been pushing for organizational reforms, including restructuring, just a month after his appointment. Intel is reported to be reducing its workforce by approximately 20%.
CEO Tan is expected to significantly revise the business strategy. In the foundry business, he has already shifted focus from the troubled 18A (1.8nm-class) process to the 14A (1.4nm-class) process. As TSMC and Samsung Electronics focus on mass production of 2nm-class processes in the second half of this year, Intel aims to narrow the gap by producing 1nm-class processes first. In advanced processes, Intel currently has effectively no customer orders beyond its own CPU and AI semiconductor volumes. On the 3rd, Reuters reported, "CEO Tan is reviewing the transition from the existing 18A foundry process to the next-generation 14A process for focus."
It is understood that Intel is also planning to revise its business strategy in the AI sector, where it is struggling against competitors like NVIDIA and AMD. Intel is reportedly set to focus not on AI semiconductors utilized in data center servers but on edge AI semiconductors applicable to user devices. CEO Tan reportedly told employees, "Training AI semiconductors are too late to enter since NVIDIA has strong market dominance; instead, we will focus on 'edge' AI that provides AI capabilities directly to PCs and other devices."
An official in the semiconductor industry stated, "It appears that Intel strongly feels the crisis that it will inevitably fall behind competitors like NVIDIA, AMD, and TSMC with its current business methods." He added, "Given that engineers are accustomed to the business methods focused on CPUs and similar areas that have been prioritized for a long time, it may take some time to improve the corporate structure."