Intel's new CEO might have the last best chance to turn around the company — here's how he could do it

Investors are betting connected caller Intel (INTC) CEO Lip-Bu Tan to crook astir the troubled chipmaker.

While it's unclear whether Intel's fiscal problems tin beryllium fixed quickly, Wall Street analysts — and existent and erstwhile employees — mostly hold connected what steps Tan needs to take, abbreviated of a breakup. Those steps see everything from cutting jobs to turbocharging Intel's young foundry business.

A semiconductor manufacture veteran, Tan was appointed to his caller relation connected March 12. Investors applauded the news: Intel banal roseate much than 15% the aforesaid day. Analysts liked Tan's acquisition arsenic erstwhile CEO of Cadence Design Systems, a semiconductor plan bundle company, and his acquisition connected boards of immoderate 14 semiconductor companies, including Intel.

Now the hard part.

Tan is inheriting a institution whose fiscal losses person made it a takeover people successful caller months. Many Wall Street analysts and investors judge Intel — which is the lone American leading-edge spot shaper — would beryllium amended disconnected splitting up and selling its struggling manufacturing business. Case successful point: The banal has risen connected assorted reports successful caller months of imaginable deals, immoderate of which were allegedly being worked connected with the enactment of the Trump administration.

Reuters reported past week that Tan plans to support Intel's manufacturing concern moving for present and is looking to bolster Intel's faltering AI spot efforts to drawback up to Nvidia (NVDA). He said arsenic overmuch successful a missive to employees connected March 12: "Together, we volition enactment hard to reconstruct Intel's presumption arsenic a world-class products company, found ourselves arsenic a world-class foundry and delight our customers similar ne'er before."

Read much astir Intel's banal moves and today's marketplace action.

Yahoo Finance interviewed 4 Wall Street analysts and 9 existent and erstwhile Intel employees — including high-level executives. The employees were granted anonymity owed to nondisclosure agreements and fearfulness of jeopardizing aboriginal employment opportunities. Some of those sources said Intel should beryllium near successful 1 piece, astatine slightest for now. That's because, if divided up, Intel's foundry would instantly spell bankrupt, Bernstein expert Stacy Rasgon told Yahoo Finance.

And Intel's merchandise business, which designs the chips, can't outsource to rival manufacturers truthful easy — Intel semiconductors are specifically made successful accordance with its ain interior manufacturing processes. Not to mention, Intel's billions successful CHIPS Act backing requires it to clasp bulk ownership of its foundry.