Gelsinger’s Missteps Strain Crucial TSMC Partnership
When Pat Gelsinger stepped in as Intel’s CEO three years ago, he aimed to revive Intel’s legacy. Yet, a rocky approach to Intel’s relationship with Taiwan’s semiconductor giant, TSMC, signaled early missteps. Gelsinger’s comments questioning Taiwan’s geopolitical stability led TSMC to rescind a vital 40% discount, forcing Intel to pay full price for 3-nanometer wafers, ultimately shrinking profit margins.
Sky-High Promises, But Delays Impact Intel’s Image and Deals
As Gelsinger pursued ambitious AI and manufacturing goals, Intel faced setbacks, including delays in their 18A chip process and failure to secure major client contracts. According to insiders, public projections on AI chips were overinflated compared to Intel’s internal forecasts. Gelsinger’s aim to turn Intel into a leading foundry fell short, with some clients hesitating due to technical and timeline concerns.
Intel’s Financial Struggles and Workforce Cuts Mark a Pivotal Era
Under Gelsinger’s leadership, Intel’s revenue dropped to $54 billion in 2023, and the stock price has plummeted 66% from its peak. Facing its first annual loss since 1986 and a share price slump, Intel announced restructuring, job cuts, and is navigating takeover interest. Despite the setbacks, Intel says it’s committed to a five-year turnaround, citing a historic pace of innovation and billions in U.S. support secured to fuel the company’s future.