The latest development in Intel’s clash with President Trump suggests a more amicable relationship after a Monday meeting with Intel CEO Lip-Bu Tan at the White House. After the meeting, Trump backed off his demand that Tan resign and called him a “success.”
In an Aug. 11 post on his Truth Social platform, Trump wrote: “I met with Mr. Lip-Bu Tan, of Intel, along with Secretary of Commerce, Howard Lutnick, and Secretary of the Treasury, Scott Bessent. The meeting was a very interesting one. His success and rise is an amazing story. Mr. Tan and my Cabinet members are going to spend time together, and bring suggestions to me during the next week. Thank you for your attention to this matter!”
Intel’s statement following the Monday meeting reads: “Earlier today, Mr. Tan had the honor of meeting with President Trump for a candid and constructive discussion on Intel’s commitment to strengthening U.S. technology and manufacturing leadership. We appreciate the President’s strong leadership to advance these critical priorities and look forward to working closely with him and his Administration as we restore this great American company.”
What happened before the about-face
In the days before the Aug. 11 meeting, Trump called for Tan’s immediate resignation.
Without elaboration or explanation for why he thought Tan, on the job for five months, must go, Trump wrote in an Aug. 7 Truth Social post: “The CEO of INTEL is highly CONFLICTED and must resign, immediately. There is no other solution to this problem. Thank you for your attention to this problem!”
For its part, Intel issued a statement on Aug. 7 that did not directly address Trump’s demand but said in part that Tan and the Intel board “are deeply committed to advancing U.S. national and economic security interests and are making significant investments aligned with the President’s America First agenda.”
The call for Tan’s resignation coincided with an Aug. 6 letter Sen. Tom Cotton (R-AK) sent to Intel Chairman Frank Yeary, in which he expressed concerns about “Intel’s operations and its potential impact on U.S. national security,” citing a report alleging Tan’s links to Chinese firms and the fact Cadence Design Systems, the company Tan previously led before joining Intel, had pled guilty to selling software to a Chinese university that had been on the U.S. Entity List.
In his letter, Cotton wrote: “Intel is required to be a responsible steward of American taxpayer dollars and to comply with applicable security regulations,” pointing out that Intel had received nearly $8 billion in grants from the CHIPS Act.
Cotton added that in becoming CEO of Intel, Tan reportedly controls dozens of Chinese companies and has a stake in hundreds of Chinese advanced-manufacturing and chip firms. At least eight of these companies reportedly have ties to the Chinese People’s Liberation Army. “Mr. Tan’s associations raise questions about Intel’s ability to fulfill these obligations,” he stated.
Analyst reaction to initial call for resignation
Analysts did not hold back after Trump’s initial Aug. 7 comments demanding a change in Intel’s leadership:
“Trump doesn’t know what he’s talking about or what he’s calling for. This is the same man who, by his admission, wanted to break up NVIDIA until he met Jensen Huang. He posted that statement to Truth Social minutes after watching Tom Cotton on Fox News talk about the subject,” said Anshel Sag, senior analyst with Moor Research and Insights.
“I think this is all BS. Any CEO with ties to international VCs will have contacts with Chinese companies, especially if you are in tech. That is how modern-day tech works. If there is proof of some wrongdoing, then show it,” said Jack Gold, president of J. Gold Associates.
Gold wondered why this is not an issue for the other chip companies, which also have investments in companies all over the world. “China bashing seems to be the first step, but many other companies that US firms work with have back doors into Chinese companies, as we’ve seen recently with top end Nvidia chips being transshipped to China,” he said.
Sag noted that Tan wasn’t even implicated in the Cadence settlement, and Tan’s unique background makes him a valuable asset to Intel, which is why he was appointed a board member before he even served as CEO. If there were reservations about his involvement in Intel, those concerns should’ve been raised long ago.
“The reality is that the President of the United States shouldn’t be meddling in any private business affairs, let alone one of the most important semiconductor companies in the world that is currently trying to turn itself around and bring semiconductor manufacturing back to the US, which is one of Trump’s own goals,” said Sag.
“Trump has a way of shooting first and asking questions later. Not a surprise there. Again, if you have some proof of wrongdoing, show it. Otherwise, stop the attacks by innuendos. Intel has enough challenges right now. They don’t need this to handle as well,” said Gold.
Meanwhile, on Aug. 8, Fortune published a report saying that four former members of the Intel board of directors were calling for the removal of the entire board of directors and Tan and divesting the company’s foundry business completely, something that has been brought up but never taken seriously by Intel.
Source:: Network World