Intel’s Future at a Crossroads: Former Board Members Demand Radical Overhaul to Secure America’s Chip Leadership

The global semiconductor race is intensifying, and Intel—once America’s crown jewel in chip manufacturing—is under fierce scrutiny. Four former Intel board members have joined forces to back President Donald Trump’s recent demand for CEO Lip-Bu Tan’s resignation, but they’re not stopping there. Their bold vision calls for spinning off Intel’s manufacturing division into an independent company, aiming to restore US leadership in the critical field of semiconductor production and safeguard national security. This dramatic restructuring proposal arrives amid mounting concerns about Tan’s business ties to China and Intel’s slipping competitive edge against rivals like Nvidia and Taiwan’s TSMC.

the Original

In a joint statement shared with Fortune, former Intel directors Charlene Barshefsky, Reed Hundt, James Plummer, and David Yoffie laid out a sweeping plan to radically restructure Intel by carving out its “Foundry” business—its chip manufacturing arm—into a standalone entity. This move is seen as essential for reclaiming America’s dominance in semiconductor manufacturing. The former board members emphasized that Intel’s leadership turmoil—four CEOs in seven years—has failed to deliver meaningful progress, necessitating a fundamental break to revitalize the company’s competitiveness and address critical national security concerns.

The controversy intensified when President Trump publicly called for CEO Lip-Bu Tan’s resignation on social media, citing warnings from Senator Tom Cotton about Tan’s extensive business dealings with Chinese firms, including several linked to China’s military. Tan, who has led Intel for just over a year and has lived in the US for more than four decades, defended his integrity in a company-wide memo, asserting that he has always adhered to strict ethical standards.

The former board members propose creating a separate, independent foundry company with its own leadership structure to directly compete with Taiwan’s TSMC, the dominant global chip manufacturer. They urge that remaining US government funds from the CHIPS Act—a \$52 billion subsidy aimed at boosting American semiconductor production—be funneled to support this new venture, encouraging US chip designers to place orders domestically.

Intel’s chip technology has lagged behind rivals, currently two generations behind Nvidia and TSMC. Despite securing the largest CHIPS Act subsidy of \$8 billion, Intel’s leadership and manufacturing strategy have come under fire, particularly given Tan’s contested China connections amid heightened geopolitical tensions.

What Undercode Say:

Intel’s predicament is a microcosm of broader strategic challenges facing the US semiconductor industry today. The company’s decline in manufacturing prowess is not just a business issue but a national security concern, especially as the semiconductor supply chain becomes a geopolitical battleground.

The former board members’ call to spin off the foundry business is a bold and necessary step. Intel’s vertically integrated model—designing and manufacturing chips under one roof—was once a competitive advantage but has become a liability in an era where specialization and agility dominate. Separating manufacturing into a focused entity could unleash innovation, streamline operations, and attract dedicated investment to compete directly with TSMC, which has successfully captured global foundry market share with cutting-edge process technology and a flexible customer base.

Moreover, Intel’s internal leadership instability has hampered long-term strategy. Four CEOs in seven years point to a company struggling with vision and execution. A new foundry spin-off could create a fresh start with clear accountability, attracting talent and partners aligned with the critical mission of securing American chipmaking sovereignty.

President Trump’s spotlight on CEO Tan’s China ties underscores the complicated intersection of business and geopolitics in semiconductors. The industry is caught between the imperatives of globalization and the strategic need for trusted domestic supply chains. Even if Tan’s personal record is clean, perceptions and political pressures around China relationships are intensifying. This reality demands transparency and stringent governance to assure US stakeholders and policymakers.

CHIPS Act funding represents a historic opportunity to revitalize US chip manufacturing, but how these funds are deployed will determine future leadership. Directing resources to a newly independent foundry could energize the ecosystem, encouraging American design firms to keep their manufacturing domestic and reduce dependence on foreign suppliers.

However, this restructuring will face significant challenges—operationally, culturally, and politically. Intel’s entrenched corporate culture, complex global footprint, and shareholder interests will resist abrupt change. The split must be managed delicately to maintain continuity in Intel’s core businesses while empowering the foundry to innovate rapidly.

Overall, the proposal is a strategic wake-up call. Without radical transformation, Intel risks becoming a footnote in semiconductor history while the US cedes ground to foreign competitors. Embracing a leaner, more focused manufacturing entity is the kind of bold move that could reposition Intel—and America—at the forefront of chipmaking for decades to come.

Fact Checker Results

✅ Former Intel directors Charlene Barshefsky, Reed Hundt, James Plummer, and David Yoffie publicly called for spinning off Intel’s foundry business.
✅ Lip-Bu Tan has been CEO for about one year and has publicly addressed concerns about his Chinese business ties.
✅ Intel received an \$8 billion subsidy from the US CHIPS Act, the largest single grant to one company.

📊 Prediction: Intel’s Radical Spin-Off Could Redefine the Semiconductor Landscape

If Intel moves forward with spinning off its foundry business, the semiconductor industry could see a seismic shift. This new entity would compete head-to-head with TSMC, potentially attracting significant government funding and American design firms eager for a trusted domestic partner. Over the next 3-5 years, this move could reinvigorate US chip manufacturing, reduce reliance on foreign suppliers, and create a fresh powerhouse in semiconductor fabrication.

Yet, success hinges on strategic execution—strong leadership for the new company, clear separation from Intel’s legacy challenges, and robust government backing. If mishandled, the spin-off could falter amid operational complexity and internal resistance. However, if done right, it may restore US supremacy in chipmaking and set a precedent for innovation-led industrial policy.

The geopolitical stakes are high, and Intel’s transformation may become a template for balancing commercial success with national security imperatives in critical technology sectors worldwide.