"The company may still boast one of Silicon Valley's most storied names, but its staff, which numbered 96,000 as of the end of July, had worked for years through nearly uninterrupted decline, watching their company lose nearly all relevance. Though its stock price soared just before the pandemic on a data center boom, then again on an ambitious (and since abandoned) plan to expand its manufacturing business, Intel last produced truly leading-edge chips in 2017."
"So when employees logged on to watch a press conference on Sept. 18, anticipation was high. And finally, there was some good news to share: Intel CEO Lip-Bu Tan and Nvidia chief executive Jensen Huang appeared on a split screen to share the details of a surprise deal: Nvidia would be investing $5 billion into Intel, a hugely needed boost of capital and confidence from the most powerful man in business."
"One senior manager, who did not want to be named as he is not authorized to speak publicly about internal matters, said his chat threads lit up. "Jensen likes us!" was the overwhelming reaction, he recalls. Many employees seemed to believe that Nvidia's cash infusion and interest in partnering with Intel on chips, which followed investments from the federal government and SoftBank, would help save the chipmaker."
"Most notably, Intel missed the mobile phone revolution in the early 2000s, when then-CEO Paul Otellini turned down Apple's request to have Intel build chips for the first iPhone. The company also missed the AI boom, having stopped making the chips that hyperscalers and AI giants like Nvidia badly need seven years ago, and ceding that market to Taiwan's TSMC and Korea's Samsung."
Intel employed about 96,000 people as of the end of July and endured years of near-uninterrupted decline that eroded its relevance. The company last produced truly leading-edge chips in 2017 and missed major market shifts, including the mobile revolution and the AI chip boom. On Sept. 18, Intel CEO Lip-Bu Tan and Nvidia CEO Jensen Huang announced that Nvidia would invest $5 billion in Intel, providing capital and confidence. Employees reacted with visible enthusiasm and saw the investment, alongside federal and SoftBank funding, as a potential lifeline. Strategic missteps included declining to build chips for Apple’s first iPhone and stopping production of chips demanded by hyperscalers, allowing TSMC and Samsung to gain the lead.
Read at Fortune
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