Trump forced the CEO of Intel to resign, and the giant company urgently shouted "America First"
On August 7th, US President Trump posted a message on his social media platform, demanding that Intel's CEO Chen Liwu resign immediately, stating that there was a serious conflict of interest and claiming that "there is no other solution to this problem".
Previously, Republican Senator Tom Cotton had written to the Intel board, questioning Chen Liwu's investment of over 200 million US dollars in 600 Chinese companies through his founded Dawen International from 2012 to 2024. Additionally, Cadence Systems, which was once led by Chen Liwu, was recently sued for violating export control regulations. After "paying a total of 140.6 million US dollars in criminal and civil fines and confiscation," the company reached a settlement agreement with the US Department of Justice and the US Department of Commerce, which further heightened concerns about the so-called "national security risks" of him.
Cotton expressed his stern words in the letter, stating that these investments involved semiconductor enterprises associated with the Chinese military. He expressed his concerns about "the safety and integrity of Intel's operations and its potential impact on US national security". He inquired whether the board knew about the subpoenas Cadence received during Chen Liru's tenure as CEO, and what measures were taken to address these issues before hiring Chen Liru. Additionally, Cotton questioned whether the Intel board required Chen Liru to divest his investments in chip companies associated with China, and whether Chen Liru fully disclosed other connections with Chinese companies given Intel's participation in the "security enclave program" of the Biden administration aimed at ensuring the secure supply of defense microelectronics.
Since Intel received federal funds under this program, Cotton further questioned Yerli in the letter about whether Chen Liwu had fully disclosed his investments in the Chinese company, his professional role, or any other connections. He emphasized: "Intel must be a responsible manager of the funds of American taxpayers and abide by applicable security regulations. Mr. Chen's affiliations have raised questions about Intel's ability to fulfill these obligations."
In response to Cotton's doubts, an Intel spokesperson issued a statement saying: "Intel and Mr. Chen are firmly committed to the national security of the United States and the integrity of our role in the US defense ecosystem." The company said it would communicate with the senator regarding the matters mentioned in the letter.
Affected by the news that Trump demanded Chen Liwu to resign, Intel's stock price on the pre-market trading session dropped by more than 5%, and its market value evaporated by nearly 3.6 billion US dollars in one day. As of the time of this report, Intel's stock price has fallen below 20 US dollars, and its total market value is 86.533 billion US dollars.
Subsequently, Intel defended its leadership in a statement, emphasizing its commitment to the priorities of the US economy and national security. The statement read: "Intel, the board, and Chen Liwu are firmly committed to advancing the national and economic security interests of the United States, and are making significant investments in accordance with the President's America First agenda." "Intel has been manufacturing in the United States for 56 years. We will continue to invest billions of dollars in semiconductor research and manufacturing in the domestic sector, including our new factory in Arizona, which will adopt the most advanced manufacturing process technologies in the United States, and we are the only company investing in the development of leading logic process nodes in the United States."
Chen Liwu is a Chinese-American. He officially took over as the CEO of Intel in March this year. His career has been highly successful. During his tenure as the CEO of Cadence Design Systems from 2009 to 2021, the company's revenue doubled, the profit margin significantly increased, and the stock price rose by over 3200%. From 2022 to 2024, Chen Liwu served on the Intel board of directors. Later, due to differences with the former CEO Kishinig in multiple issues, he submitted his resignation and left the company in 2024.
When Intel was facing numerous difficulties, Chen Liwu returned again and launched a series of reform plans, including reducing the total number of employees from approximately 109,800 to 75,000 by the end of the year. Chen Liwu emphasized that the layoffs were aimed at "eliminating bureaucracy, simplifying the decision-making process, and concentrating resources on strategic areas such as AI chips, customized semiconductors, and wafer foundry." On July 25th, Chen Liwu stated in a memo to employees that the company had "completed most" of the layoff plan, with the number of layoffs accounting for 15% of the total workforce, and planned to control the total number of employees at 75,000 by the end of this year. Previously, Intel had indicated that it planned to cut its operating expenses by $17 billion by 2025.
In terms of business strategy adjustments, Chen Liwu made significant changes to Intel's foundry business. On July 2nd, according to foreign media Reuters, he pushed the company to stop promoting the long-term investment 18A process technology to external customers and instead focused resources on researching and developing the next-generation 14A process. This decision means that Intel has completely deviated from the expansion route of foundry set by the former CEO Kisheng, and the 18A is only retained for internal products (such as the "Panther Lake" laptop chip that will be mass-produced later in 2025). Intel internal documents show that the 14A is positioned as "a process node beyond TSMC's N2", and is planned to be mass-produced in 2027, with the goal of achieving leading performance in key indicators such as transistor density and energy efficiency ratio in the next generation.
In addition, Intel has cancelled the projects of building wafer factories in Germany and Poland, and will integrate its testing and assembly operations in Vietnam and Malaysia. It has also slowed down the pace of building a cutting-edge chip factory in Ohio, depending on market demand and whether it can secure major customers for the factory. Chen Liwu said, "In the past few years, the company invested too much and too quickly, while the demand was insufficient, resulting in scattered factory layouts and low utilization rates."
In terms of technological research and development direction, Chen Liwu reaffirmed Intel's investment plan in advanced manufacturing processes, emphasizing that Intel needs to shift from "hardware priority" to "synergistic development of software and hardware" to meet the demands of the AI era. At the same time, he will personally review and approve all chip designs before proceeding to the fabrication process, strengthening control over the chip design环节.
According to the second-quarter financial report of 2025, Intel's revenue for the second quarter was 12.86 billion US dollars, exceeding the market expectation of 11.9 billion US dollars. Although the loss expanded year-on-year, it still brought some confidence to the market.
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