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He’s used to competent fabs so he might decide to pull the trigger and sign a sweetheart deal with TSMC in exchange for shutting down the fabs, firing everyone involved and promising never to go back in the manufacturing business again.
I don't think shutting down Intel fabs is necessary. Globalfoundries is doing OK now after splitting from AMD. An independent Intel Foundry may have chances to do better than Globalfoundries. But the window to do it successfully is shrinking quickly. One of the Pat Gelsinger's misjudgements is that he thought the market, customers, competitors, investors, and even the US government could wait for Intel to fix its problems. It turned out he is wrong.
Yes, Intel's problems have been years in the making. Is it reasonable or practical to solve them in a short period of time? For Pat, it was about four years, and he failed. Or did the Intel Board of Directors find out that another four years wouldn't make much difference if they stayed on the same route?
But regardless, Intel's customers and competitors won't just sit idle and wait for Intel for another four years to correct all its problems.
Intel needs to be split into two companies: a design company and a fab. Otherwise, the design division will complain that the fab is holding them back, while the fab will complain that the design division has taken away the profits that the fab has earned in the past.
Intel needs to be split into two companies: a design company and a fab. Otherwise, the design division will complain that the fab is holding them back, while the fab will complain that the design division has taken away the profits that the fab has earned in the past.
I think Intel needs to maintain its manufacturing operations and scale them according to its needs as a priority.
Both Bernstein and Citi's analysts believe that if Intel takes this approach, it could achieve financial recovery.
Many people want Intel to split, not for the company's benefit but for supply chain resiliency. However, that responsibility should lie with the U.S. government and TSMC (and its clients). If they want Intel to contribute to this effort, they should compensate Intel and implement complementary policies. Intel should not bear the financial burden of insuring against potential risks for its peers. I believe this is a misguided stance by PG.
Intel's primary goal should be to restore its financial health and return to a growth trajectory. Its fabs should be leveraged as a competitive advantage, not a liability.
Intel needs to be split into two companies: a design company and a fab. Otherwise, the design division will complain that the fab is holding them back, while the fab will complain that the design division has taken away the profits that the fab has earned in the past.
There are at least three lines of thinking that argue for keeping Intel in its current form:
1. Intel is the only hope for X, Y, and Z.
In reality, there are many competitors that offer better or comparable products. In many areas, Intel doesn't even have a product offering at all.
2. Intel is critical for maintaining America's semiconductor supply stability and capability.
In reality, bringing more of TSMC's and other proven players' manufacturing capabilities to the US is much more practical and achievable than waiting for Intel to fix its problems.
3. Intel's problems are fixable; we just need to be patient and give it enough time to right the ship.
In reality, other than the Intel employees and those who bought Intel stocks at high prices, no one wants to wait. The industry won't wait, the customers won't wait, Intel's competitors won't wait, and the US government won't wait.
