Yesterday, President Donald Trump publicly called for Intel CEO Lip-Bu Tan’s resignation, over accusations of “deeply conflicted” ties to China. Now, he is speaking out and making it clear he has no plans to step aside.
A quick recap
Before joining Intel, Tan worked as CEO for Cadence Design Systems, a firm that just pleaded guilty to an investigation by the Justice Department over charges of “selling its chip-design products to a Chinese military university,” per the Wall Street Journal’s description.
Tan was also the subject of a Reuters investigation earlier this year, which found that he had “invested in hundreds of Chinese tech firms, including at least eight with links to the People’s Liberation Army”.
This led at least two Republican Senators to publicly question Tan’s suitability as Intel’s Chief Executive Officer, and urge the board to consider new leadership.
Trump’s remarks yesterday escalated things further, adding to months of escalating friction between Tan and Intel’s board over the company’s future.
Tan speaks out
In a letter sent to all Intel employees (and later published on the company’s website), Tan pushed back on what he described as “misinformation” about his past ties to China, and reiterated his commitment to both the company and the United States.
“The United States has been my home for more than 40 years. I love this country and am profoundly grateful for the opportunities it has given me. (…) There has been a lot of misinformation circulating about my past roles at Walden International and Cadence Design Systems. I want to be absolutely clear: I have always operated within the highest legal and ethical standards.”
Despite mounting pressure both inside and outside the company, Intel’s board is standing by Tan for now, and the CEO says Intel is in active talks with the White House to clear the air:
“We are engaging with the Administration to address the matters that have been raised and ensure they have the facts. (…) I fully share the President’s commitment to advancing U.S. national and economic security.“
After falling 3% yesterday, Intel’s stock spent most of the day down another 1% before bouncing back late in the session to close 0.9% higher. Still, shares remain 23% below the post-spike high that followed Tan’s appointment as CEO.
Below is Tan’s full letter to Intel employees:
My commitment to you and our company
Dear Team,
I know there has been a lot in the news today, and I want to take a moment to address it directly with you.
Let me start by saying this: The United States has been my home for more than 40 years. I love this country and am profoundly grateful for the opportunities it has given me. I also love this company. Leading Intel at this critical moment is not just a job – it’s a privilege. This industry has given me so much, our company has played such a pivotal role, and it’s the honor of my career to work with you all to restore Intel’s strength and create the innovations of the future. Intel’s success is essential to U.S. technology and manufacturing leadership, national security, and economic strength. This is what fuels our business around the world. It’s what motivated me to join this team, and it’s what drives me every day to advance the important work we’re doing together to build a stronger future.
There has been a lot of misinformation circulating about my past roles at Walden International and Cadence Design Systems. I want to be absolutely clear: Over 40+ years in the industry, I’ve built relationships around the world and across our diverse ecosystem – and I have always operated within the highest legal and ethical standards. My reputation has been built on trust – on doing what I say I’ll do, and doing it the right way. This is the same way I am leading Intel.
We are engaging with the Administration to address the matters that have been raised and ensure they have the facts. I fully share the President’s commitment to advancing U.S. national and economic security, I appreciate his leadership to advance these priorities, and I’m proud to lead a company that is so central to these goals.
The Board is fully supportive of the work we are doing to transform our company, innovate for our customers, and execute with discipline – and we are making progress. It’s especially exciting to see us ramping toward high-volume manufacturing using the most advanced semiconductor process technology in the country later this year. It will be a major milestone that’s a testament to your work and the important role Intel plays in the U.S. technology ecosystem.
Looking ahead, our mission is clear, and our opportunity is enormous. I’m proud to be on this journey with you.
Thank you for everything you’re doing to strengthen our company for the future.
Lip-Bu
What do you think Intel should do? Let us know in the comments.
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