June 9 - Lip-Bu Tan took the helm at Intel (INTC, Financial) this year, bringing a reputation for turnaround success from his 2009–2021 tenure at Cadence Design Systems (CDNS).
When Tan became CEO of Cadence, its shares traded near $5.50. By the time he stepped down, the stock hovered around $186, up roughly 3,200%. That feat suggests his playbook might resonate at Intel, where shares currently trade near $20.
Tan has already moved to trim headcount, flatten bureaucracy and refocus on core engineering strengths. He's said Intel must shed non-core assets and sharpen its customer focus, steps likely to improve operating metrics over time.
On the AI front, Tan has launched initiatives for AI-optimized hardware and software, backed by new Chief Technology and AI Officer Sachin Katti. Longer term, Intel's existing efforts in quantum computing, like its 12-qubit Tunnel Falls chip, may benefit as larger players such as Alphabet Inc. (GOOG, Financial) and Amazon.com, Inc. (AMZN, Financial) seek reliable foundry partners.
Intel also stands to gain from U.S. onshoring trends under the current administration. Meanwhile, the emerging humanoid robot market, projected by The Goldman Sachs Group, Inc. (GS) to reach $38 billion by 2035, could offer additional upside if Intel's processors and RealSense depth cameras become standard “brains” for new robotic systems.
Tan's challenge is steep, but his track record suggests Intel may find a path back toward growth and greater investor confidence.
