US President Trump Calls for Intel CEO Lip-Bu Tan to Resign Amid Conflict of Interest
Due to conflict of interest concerns, US President Trump publicly demanded that Intel’s current CEO Lip-Bu Tan step down immediately, leading to a drop in Intel’s stock price and raising market concerns about its executive turmoil and potential national security issues.
Trump’s Outburst: Lip-Bu Tan Must Resign Due to “High Conflict of Interest”
Trump took to his social media platform Truth Social to accuse Intel CEO Lip-Bu Tan of having a “high conflict of interest,” stating that “there is no other solution,” and that he must resign immediately.
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Tan took over as Intel’s CEO in March of this year, succeeding the underperforming former CEO Pat Gelsinger, with the responsibility of revitalizing the company’s sales. However, just a few months into his tenure, he faced scrutiny from politicians due to his past connections with Chinese firms.
Republican Lawmakers Question Tan’s Ties with China
This week, Republican Senator Tom Cotton wrote to the Intel board, expressing concerns regarding Tan’s connections to Chinese companies, particularly related to controversies during his tenure as CEO of Cadence Design. Cotton emphasized that, as a beneficiary of US taxpayer funding, Intel must fulfill its national security and cybersecurity responsibilities, highlighting that Tan’s business relationships could undermine the company’s credibility and compliance capabilities.
Does Tan Have Ties to Chinese Military-Related Companies?
According to a Reuters report from April this year, Tan previously invested in multiple Chinese tech companies through personal or venture capital funds, some of which have connections to the Chinese Communist Party or the People’s Liberation Army. These investments have raised concerns about whether Intel’s executives might transfer sensitive technology to potential adversaries, especially against the backdrop of escalating US-China tech tensions.
Q2 Financial Report Better Than Expected, but Significant Spending Cuts Announced
Despite the controversy, Intel’s Q2 financial report released in July exceeded market expectations. However, Tan simultaneously announced several drastic spending cut plans, generating internal transformation pressures.
In an internal memo, he noted that the company would downsize its severely loss-making foundry business, which reported a loss of $3.17 billion in Q2. Intel also canceled plans for new factories in Germany and Poland and consolidated testing and assembly operations in Vietnam and Malaysia; additionally, construction of a chip plant in Ohio will be slowed.
Leadership Turmoil May Impact Intel’s Transformation Process
Intel is at a critical juncture in its corporate transformation, with Tan pushing for cost control and structural reforms while simultaneously facing political and market pressures due to his background with China. Trump’s public criticism not only shakes external confidence in his leadership capabilities but may also further intensify the US government’s scrutiny of Chinese backgrounds in the tech industry.
As Intel has yet to respond to Trump’s remarks, whether this turmoil will lead to personnel changes or have a greater impact on the company’s future strategies remains to be seen.
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