‘It’s too late for us…’Intel’s new CEO delivers brutal reality check as Nvidia’s AI boom continues

Intel

Intel’s new chief Lip-Bu Tan told employees this week that the once-dominant chipmaker no longer ranks among the top 10 semiconductor companies in the world. According to a report by Oregon Live, the Intel CEO told employees that things have changed drastically.

“Twenty, 30 years ago, we are really the leader,” Tan said in a global employee broadcast. “Now I think the world has changed.” The comments come as Intel begins thousands of layoffs across multiple locations, a sweeping move aimed at making the company leaner and faster—more like its rivals Nvidia, Broadcom, and AMD, according to Tan.

While Intel still holds a large footprint in PCs and server chips, its market value — hovering around $100 billion — has plummeted by half in just 18 months. Meanwhile, Nvidia briefly crossed $4 trillion in valuation this week, underscoring how far Intel has fallen behind in the era of AI.

Tan pulled no punches: Intel’s customers are frustrated, decision-making is glacial, and the company has “no chance” of catching Nvidia in the market for AI training chips. “On training, I think it is too late for us,” he admitted, noting Intel’s absence from the GPU-led AI boom.

Instead, Tan outlined a pivot toward edge AI — bringing AI capabilities directly to devices — and agentic AI, a rising field that lets AI operate independently with minimal human input. “That’s an area that I think is emerging, coming up very big, and we want to make sure we capture it,” he said, teasing new hires in the works to bolster Intel’s AI push.

Internally, the shake-up is massive. Intel is shutting down its automotive business, outsourcing marketing, and cutting up to 20% of jobs in manufacturing. The goal, Tan said, is to trim the fat and make Intel less bureaucratic: “Eventually nobody makes a decision,” he remarked.

Intel’s once-promising 18A process node, which the company hoped would turn it into a major chip foundry, has failed to attract outside clients. Reports suggest the focus may now shift to 14A, but Tan didn’t address this directly. Instead, he stressed that Intel must first prove it can meet its own chip needs.

If Intel’s comeback is a marathon, as Tan calls it, the race has only just begun.