Intel has undergone significant changes in recent years, especially with the arrival of CEO Lip-Bu Tan. These changes have stirred uncertainty in the markets, but they seem to offer a glimpse into Intel’s future direction. Before diving into Tan’s leadership, it’s important to understand Intel’s operations under former CEO Pat Gelsinger. His ‘IDM 2.0’ strategy pushed Intel toward an internal manufacturing model, aiming to compete with the likes of TSMC. However, despite substantial investments in Intel Foundry Services (IFS), results have been disappointing. 
The 18A node, which was supposed to be launched in 2024, has been delayed until early 2026, and IFS has yet to turn a profit.
Another major issue under Gelsinger’s tenure was Intel’s slow response to the AI boom. While competitors like NVIDIA and AMD capitalized on AI, Intel lagged, failing to offer a competitive rack-scale AI solution. This has left Intel behind in a market that has brought in billions for its rivals.
Fast forward to 2025, and Lip-Bu Tan, who had been on Intel’s board since 2022, took over as CEO. His first move was to tackle the company’s internal structure, streamlining operations by reducing bureaucracy and focusing on core competencies. Tan has made it clear that Intel will be an ‘engineering-focused’ company, and this means outsourcing non-essential operations. For instance, Intel has turned over its marketing efforts to Accenture, leveraging AI to reshape its brand. This shift has resulted in aggressive layoffs, cutting costs to redirect resources into promising areas like consumer computing.
One of Tan’s most significant changes has been the reduction of Intel’s reliance on external customers for its foundry division. While the IFS was once seen as a potential competitor to TSMC, under Tan, the focus has shifted towards internal needs. This shift in strategy, though difficult for external customers, was communicated early by Intel’s CFO, who stated that the company would not be prioritizing external foundry business.
Despite these tough measures, Tan’s leadership appears to be guiding Intel toward long-term sustainability. Intel’s restructuring is harsh but necessary, as the company looks to reinvigorate its operations and catch up with market demands. With a more customer-centric approach, Intel is focusing on developing high-performance CPUs and strengthening its partnership with TSMC to source chips for future products.
While it’s unclear how quickly these changes will yield results, Tan’s aggressive cuts and engineering-focused strategy seem to be a crucial step toward revitalizing Intel. The company may not regain its former glory overnight, but under Tan, Intel is positioning itself for a future with more capable hardware and a more agile corporate structure.