A significant leadership change at Intel is being called for by President Donald Trump, who is requesting that CEO Lip-Bu Tan step down due to potential financial ties to Chinese companies.
Trump made the plea via his Truth Social post on Thursday, stating that Tan was “highly conflicted” and that he ought to “resign immediately.”
Shortly after Republican Senator Tom Cotton wrote to Intel’s board expressing concerns with Tan’s prior investments, Trump made his forceful comment.
Over $200 million has reportedly been invested by Tan in Chinese chip businesses, some of which may have ties to China’s military.
Lawmakers and investors are concerned about this situation, particularly since Intel recently received $8 billion from the US government through the CHIPS Act to increase local chip manufacture, according to Reuters.
Given these worries, Intel’s position as a market leader in US chip manufacturing may now be in jeopardy.
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Intel Stock Drops 3% After Trump Targets CEO
Following Trump’s post, Intel’s stock dropped 3%, according to CBS News. In a succinct statement, the corporation reaffirmed its commitment to national security and stated that it would continue to collaborate with the administration.
Since taking over as CEO in March, Tan has been silent about the issue.
Tan served as CEO of Cadence Design Systems, a software company, for more than ten years. The company recently entered a guilty plea to unlawful sales to a Chinese military institution.
Intel and its board are under much more pressure as a result of that case.
Tan is well-known in the IT industry for advising semiconductor companies and assisting in the development of startups.
But according to recent rumors, his venture capital business has teamed up with state-owned Chinese investors. Public records still show several of these investments as ongoing, despite reports that Tan has sold others.
This creates a dangerous precedent, according to some experts. According to one investment manager, “you don’t want presidents telling companies who should run them,” “But Trump’s opinion still carries a lot of weight.”
Internal issues have also been plaguing Intel. In addition to delaying several of its large plant projects, it has lost market share to rivals like AMD and Nvidia.
Given that the company fired its previous CEO last year, Tan’s leadership is even more crucial.
First appeared on vcpost.com.
