TryGOLD- Free

A WOUNDED INTEL BATTLES FOR SURVIVAL IN THE AI ERA
Fortune US|October - November 2024
HENRY V had Agincourt. Gen. Robert E. Lee had Gettysburg. And Intel CEO Pat Gelsinger has Chandler. That would be Chandler, Ariz., outside Phoenix, where Intel is investing nearly $30 billion to build two state-of-the-art semiconductor plants, or fabs, that will be the first to use the company's newest chipmaking process. It's here, in Chandler, where Gelsinger's fate-and likely that of the company he leads will be decided.
- JEREMY KAHN
A WOUNDED INTEL BATTLES FOR SURVIVAL IN THE AI ERA

Gelsinger, who was named CEO in 2021, has essentially bet the company on 18A, a new chipmaking process. He hopes it will position Intel as a viable alternative to Taiwan Semiconductor Manufacturing Co. (TSMC), the world's leading contract manufacturer of chips.

The reason for Intel's struggles is clear: It fell victim to a classic innovator's dilemma-not once but twice. First, early in the 21st century, its preoccupation with producing chips for PCs and data centers led it to miss the smartphone revolution. Then, in the past decade, it missed the emergence of chips designed for artificial intelligence.

Intel rival Nvidia took a type of chip originally designed for the demands of video games, the graphics processing unit (or GPU), and turned it into the workhorse for training and running AI models. Now the generative AI boom has made Nvidia one of the world's most valuable companies, worth more than $3 trillion, compared with Intel's relatively paltry $84 billion.

Gelsinger is racing to reverse Intel's slide by repositioning the company around manufacturing excellence, while also trying to establish Intel as a player in the market for AI chips. Many are skeptical he can pull it off and fear the company may be in permanent decline. Meanwhile, chipmaker Qualcomm has reportedly expressed interest in acquiring Intel in what would be among the biggest tech takeovers ever. At press time, it was unclear if a deal would happen or whether Intel would instead partner with another company for a cash infusion that doesn't involve a buyout.

Intel wound up in such dire straits owing to missteps in its core business for central processing units (CPUs), in which it was once the unrivaled king. Production delays and problems in its own fab facilities have let rival AMD steal significant market share.

This story is from the October - November 2024 edition of Fortune US.

Start your 7-day Magzter GOLD free trial to access thousands of curated premium stories, and 9,000+ magazines and newspapers.

This story is from the October - November 2024 edition of Fortune US.

Start your 7-day Magzter GOLD free trial to access thousands of curated premium stories, and 9,000+ magazines and newspapers.

MORE STORIES FROM FORTUNE USView All
The Blackstone Edge
Fortune US

The Blackstone Edge

90 DAYS. DOZENS OF INTERVIEWS. BILLIONS ON THE LINE. HOW BLACKSTONE'S CEO-MAKER GETS THE JOB DONE.

time-read
10+ mins  |
February - March 2025
When Elon Musk has a really tough job, he turns to Steve Davis. DOGE might do the same.
Fortune US

When Elon Musk has a really tough job, he turns to Steve Davis. DOGE might do the same.

IT WAS THE FALL OF 2022 when employees at Elon Musk's Boring Company began to notice Steve Davis wasn't around.

time-read
5 mins  |
February - March 2025
ASK ANDY - SHOULD MY STARTUP RAISE MONEY FROM VCS? IF SO, WHICH ONES DO I CHOOSE?
Fortune US

ASK ANDY - SHOULD MY STARTUP RAISE MONEY FROM VCS? IF SO, WHICH ONES DO I CHOOSE?

A FRIEND—I’ll call him Allen—spent years bootstrapping his real estate enterprise software company. After a long struggle to get to $1 million in sales, his business recently surged to $10 million, and revenue is now growing 100% year on year.

time-read
2 mins  |
February - March 2025
ELLIOTT HILL - JUST DOING IT
Fortune US

ELLIOTT HILL - JUST DOING IT

Staffers and brand loyalists cheered when Nike's new CEO came out of retirement to lead the company he has had an “irrational love” for since he began there as an intern. Turning it around will take more than good vibes.

time-read
10+ mins  |
February - March 2025
HOW TO PLAN YOUR NEXT $100,000 VACATION
Fortune US

HOW TO PLAN YOUR NEXT $100,000 VACATION

ON AN EXCURSION to the ancient city of Petra, Jordan, clients helicoptered in after-hours so they could tour the ruins alone.

time-read
5 mins  |
February - March 2025
THE BATTLE OVER AG1
Fortune US

THE BATTLE OVER AG1

Influencers are fighting over it. Scientists scoff at it. But the $100-a-month powder once known as Athletic Greens is only getting more popular.

time-read
10+ mins  |
February - March 2025
THE WORKPLACE - GEN ZERS WANT TO BE THEIR OWN BOSS.CAN THE CORPORATE WORLD WOO THEM BACK?
Fortune US

THE WORKPLACE - GEN ZERS WANT TO BE THEIR OWN BOSS.CAN THE CORPORATE WORLD WOO THEM BACK?

CHASE GALLAGHER WAS 12 years old when he started mowing his neighbors' lawns in Chester County, Pa., for $35 a pop in the summer of 2013. At first the Gen Zer had only two customers, but thanks to some aggressive leafleting, he had 10 clients by the following year.

time-read
8 mins  |
February - March 2025
How much can DOGE do?
Fortune US

How much can DOGE do?

Elon Musk and Donald Trump aim to cut as much as $2 trillion in federal spending. It'll be even harder than it sounds.

time-read
5 mins  |
February - March 2025
YOUNG PEOPLE ARE DRINKING LESS ALCOHOL. CAN CEO MICHEL DOUKERIS PERSUADE THEM TO KEEP DRINKING AB INBEV'S BEERS?
Fortune US

YOUNG PEOPLE ARE DRINKING LESS ALCOHOL. CAN CEO MICHEL DOUKERIS PERSUADE THEM TO KEEP DRINKING AB INBEV'S BEERS?

SOME TIME AGO, top CEOs at an invitation-only seminar at Harvard Business School were asked to imagine the four crises they would likely confront during their tenure at the top: a health emergency, a geopolitical conflict, an economic downturn, and a trade war.

time-read
6 mins  |
February - March 2025
America's drug middlemen are now a $557 billion industry. Can Trump and his allies 'knock out' PBMs?
Fortune US

America's drug middlemen are now a $557 billion industry. Can Trump and his allies 'knock out' PBMs?

IN LATE DECEMBER, President-elect Donald Trump put pharmacy benefit managers, or PBMs, on notice.

time-read
9 mins  |
February - March 2025

We use cookies to provide and improve our services. By using our site, you consent to cookies. Learn more