Donald Trump announced his immediate departure of Lip-Bu Tan, Intel’s new CEO, and the incident has exposed growing corporate tensions over national security. The CEO has previously invested in Chinese semiconductor companies, sparking American distrust and reigniting debate over foreign interference and participation in the country’s strategic sectors.
Lip-Bu’s China connection made Trump to call for CEO’s resignation
U.S. President Donald Trump on Thursday demanded the immediate resignation of new Intel CEO Lip-Bu Tan, calling him “highly conflicted” due to his ties to Chinese firms and raising doubts about plans to turn around the struggling American chip icon. Reuters reported exclusively in April that Tan invested at least $200 million in hundreds of Chinese advanced manufacturing and chip firms, some of which were linked to the Chinese military.
Trump’s comments came a day after Reuters was first to report that Republican Senator Tom Cotton had sent a letter to Intel’s board chair with questions about Tan’s ties to Chinese firms and a recent criminal case involving his former firm Cadence Design. “The CEO of INTEL is highly CONFLICTED and must resign, immediately. There is no other solution to this problem,” Trump said in a post on his Truth Social platform.
Intel shares INTC.O closed down 3% on Thursday. A leadership change could pile pressure on Intel, which is a pillar of U.S. efforts to boost domestic chip making. Last year, it secured $8 billion in subsidies, the largest outlay under the 2022 CHIPS Act, to build new factories in Ohio and other states.
Intel deals with new political pressure
Lip-Bu issued a statement reinforcing Intel’s alignment with U.S. strategic objectives as a way to counter the political impact of Trump’s statement. Despite this, the incident sparked market concern about the company’s leadership at a crucial time of restructuring, as Trump’s statement was seen as uncertain about the company’s future.
Tan said he shared the president’s commitment to advancing U.S. national and economic security. Intel’s board was “fully supportive” of the company’s work to transform its business and ramp up advanced chip manufacturing later this year, Tan added in a statement posted on the company’s website. Trump’s intervention marked a rare instance of a U.S. president publicly calling for a CEO’s ouster and sparked debate among investors.
Investors react as political crisis Intensifies
David Wagner, head of equity and portfolio manager at Intel shareholder Aptus Capital Advisors, said while “many investors likely believe that President Trump has his hand in too many cookie jars, it’s just another signal that he’s very serious about trying to bring business back to the U.S.” Intel said it was making significant investments aligned with Trump’s America First agenda.
Reuters reported in April that Tan himself, and through venture funds he has founded or operates, invested in Chinese firms including contractors and suppliers for the People’s Liberation Army between March 2012 and December 2024. The reporting was based on a review of Chinese corporate databases cross-referenced with U.S. and analyst lists of firms with connections to the Chinese military.
Military investments and ties generate distrust
After it was revealed that Lip-Bu’s investment funds were used to finance Chinese companies linked to the military, criticism intensified, even though this occurred from 2012 to 2024. The connection to military contracts placed the executive at the center of a sensitive debate over security and technological sovereignty.
The latest clash between Trump and Lip-Bu Tan highlights how tensions between the US and China have grown, particularly when it comes to foreign policy, national security, and foreign leadership in strategic positions. The CEO’s investment history has ultimately hurt him when it comes to balancing global market interests and national strategic priorities.
GCN.com/Reuters