Intel Corp shares rose about 3% in pre-market trading on Tuesday after US President Donald Trump confirmed he had met with company chief executive Lip-Bu Tan, just days after publicly calling for his removal over alleged ties to Chinese businesses.
“I met with Mr. Lip-Bu Tan, of Intel, along with Secretary of Commerce Howard Lutnick and Secretary of the Treasury Scott Bessent,” Trump wrote on his Truth Social platform.
“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.”
An Intel spokesperson said Tan’s White House visit had been “candid and constructive,” focused on strengthening US 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,” the statement added.
Tan’s resignation could impede turnaround
Tan’s meeting with Trump came just a week after the president demanded his resignation, citing investments in Chinese firms, some reportedly linked to the Chinese military.
While US citizens are only prohibited from investing in companies on the Treasury’s Chinese Military-Industrial Complex Companies List, Trump’s comments raised fresh questions over Tan’s suitability to lead Intel during a period of heightened US-China technology tensions.
According to a Wall Street Journal report, Tan was expected to use the meeting to explain his background and address any national security concerns.
Reuters reported in April that Tan had invested in hundreds of Chinese firms over the years.
Tan faces the challenge of reversing years of setbacks that have left Intel lagging in the fast-growing AI chip market dominated by Nvidia, while its costly push into contract manufacturing has piled up significant losses.
In his six months as chief executive, he has moved quickly to reshape the company, shedding assets, cutting jobs and reallocating resources.
“But the demand for Tan’s resignation will only distract him from that task,” investors and a former senior employee have told Reuters.
Intel’s competitive challenges remain acute
Intel shares are up more than 3% year-to-date, well behind the Nasdaq Composite’s 12% gain.
The company’s stock trades at 42 times expected earnings, far above its five-year average forward price-to-earnings ratio of 20, according to LSEG data.
The chipmaker has lost ground in advanced semiconductor manufacturing to Taiwan Semiconductor Manufacturing Co. and Samsung Electronics.
Its recent earnings signaled it was unlikely to win major external customers for its 18A process in the near term. Intel also warned it might “pause or discontinue” its next-generation 14A process if it fails to secure significant business, a move that would end any realistic US competition in cutting-edge chip fabrication.
TSMC is investing $165 billion in Arizona plants, positioning itself as the dominant manufacturer on US soil if Intel falters.
Political backing could prove decisive for Intel
For Tan, persuading the president of Intel’s strategic importance could be critical.
Trump has previously shown a willingness to influence major corporate investment decisions, as seen with Apple.
Even without direct intervention, White House support could help secure funding for projects like Intel’s $28 billion Ohio semiconductor complex, which depends heavily on government subsidies.
“Arguably it wouldn’t take much to boost Intel stock, with Wall Street nearly at peak pessimism — just two analysts have a Buy rating, according to FactSet,” Barron’s said in a report.
The manufacturing arm is booking annual losses in the billions of dollars, though management expects to reach break-even by 2027 on the back of 18A and 14A adoption.
Barron’s has noted that Intel trades close to its tangible book value, comparable to a liquidation scenario given its substantial plant assets, though on earnings metrics it appears more expensive.
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