What happens when a U.S. president tries to take down the CEO of a publicly traded company?
We’re about to find out in a bizarre case that could alter not just the career of a CEO but also a one-time corporate jewel of American enterprise, a global industry, and what a previous Commerce Secretary has called “the most important piece of hardware in the 21st century.”
It would have been a one-day story if it weren’t about Intel, once the world’s biggest, most advanced maker of computer chips.
It’s decline began some 20 years ago, when the company made multiple acquisitions, many of which were in telecommunications and wireless technology. In concept, that made great sense. But acquiring businesses is a skill of its own, and David Yoffie, a Harvard Business School professor who was on Intel’s board of directors at the time, told Fortune “100% of those acquisitions failed. We spent $12 billion, and the return was zero or negative.”
Intel also tried unsuccessfully to grasp the mammoth cell phone opportunity. The company understood the opportunity and was supplying chips for the highly popular BlackBerry phone. The chips were designed by Arm, a British firm that designs chips but doesn’t manufacture them. Intel understandably preferred to make phone chips with its own architecture, known as x86. The company decided to stop making Arm chips and to create an x86 chip for cell phones—in retrospect, “a major strategic error,” says Yoffie. “The plan was that we would have a competitive product within a year, and we ended up not having a competitive product within a decade,” he recalls. “It wasn’t that we missed it. It was that we screwed it up.”
Now suppose Tan were to step down as CEO. “Who wants that job?” asks Stacy Rasgon, a longtime tech analyst at Bernstein. He observes in a recent note that Tan “doesn’t ‘need’ to run Intel (he’s very wealthy and has a lot of other things to occupy his time)…. He clearly wants to do what is best for Intel…” But it’s unclear if resigning would be good or bad for the company, “especially with Trump’s crosshairs on his back.” Rasgon, speaking to Fortune, asks, “How do you attract somebody else into that spot?”
Getting Tan wasn’t easy. “The board took a while in finding the new CEO when [previous boss] Pat Gelsinger left,” says Gupta. “It took a long time to find a candidate willing to take control and lead the company in a direction.”
Trump’s post puts himself at the center of a crucial conundrum for national security. Global dominance requires a reliable source of leading-edge chips. That’s why Commerce Secretary Gina Raimondo in 2024 said they’re “the most important piece of hardware….” The world’s largest producer of leading-edge chips by far, Taiwan’s TSMC, is building two fabs in Arizona, subsidized by the CHIPS Act, with more planned. “You can make the argument that the more capacity builds in Arizona, maybe the less we need Intel,” says Rasgon. But TSMC isn’t an American firm, and Nguyen says “the best technology from TSMC is definitely not coming to the U.S. at this time.”
Which leaves Intel. “They’re the only American company that can do it,” says Rasgon. “But Intel still has to prove they could deliver. They haven’t proven that.” Trump has shined a spotlight on the once-iconic company. But identifying problems and solving them are two very different matters, something Intel-watchers have known for going on two decades.
