Lip-Bu Tan Has Won Trump's Trust, but Intel Still Needs an AI Breakthrough

Lip-Bu Tan took over as Intel's CEO in March last year with a clear mission: to rescue one of the world's largest chipmakers and restore its status as a technology leader. His appointment was greeted with optimism, as the new CEO promised a fresh approach and investment in innovation. But seven months later, Intel's stock has stalled, and the company continues to lag in the fast-growing market for AI chips.

How the new CEO won trust

Lip-Bu Tan is an experienced executive with a reputation as a pragmatist, used to solving hard problems at engineering companies. Since becoming CEO, he has caught the attention of influential figures in politics and technology. Donald Trump and Elon Musk reacted positively to his plan to revive Intel, which emphasizes strengthening American dominance in the semiconductor industry.

Tan has talked about the need to return Intel to its position as a global leader and has proposed ambitious investments in building new fabs and developing advanced technologies.

Political weight matters: the US wants a strong domestic player rather than complete dependence on Asian manufacturers. That gives Intel leverage in negotiations over government support and subsidies.

But the market demands more

Despite positive PR and political backing, the business metrics remain bleak. Intel has lost a significant share of the market as demand for specialized AI chips has surged. Nvidia and AMD have taken key segments that traditionally belonged to Intel.

The company's share price reflects this reality: while the semiconductor market itself is growing, Intel remains on the sidelines. The problem is that new opportunities take years to develop, while investors want results now. Wall Street does not trust promises; it wants quarterly numbers and market share gains.

• Nvidia has monopolized the GPU market for generative AI
• AMD has significantly increased its share in CPUs and specialized accelerators
• Demand for chips for LLM training and inference is growing exponentially
• Intel is losing ground in cloud computing, a key segment

What kind of breakthrough Intel needs

Tan faces the classic dilemma of a capital-intensive business: investment requires money, which the company wants to spend carefully. Intel needs a product that immediately wins the trust of key customers: cloud providers and large corporations building AI-based systems.

This could be a specialized processor for LLM training or inference, an innovative manufacturing process that gives it an edge over competitors, or a radically new chip architecture. But no such announcements have been made so far.

Tan promised change and won political support. The question remains whether he can turn ambition into real products before investors lose patience.

What this means

Intel is at a critical juncture. The trust of politicians and business leaders is valuable, but it does not automatically convert into sales. The company needs to show that investment in its revival will pay off and return Intel to its place as one of the main chip suppliers for the AI ecosystem.

The next two to three quarters will be decisive for the company's future.