The former CEO of Intel Corporation (NASDAQ:INTC), Pat Gelsinger, raised alarm over too much dependence on Taiwan for chips and also provided insights into the reasons behind the chipmaker’s decline.
Gelsinger Warns on Taiwan Risks
In an interview with the “All-In Podcast” cohost Jason Calacanis, Gelsinger cautioned that Taiwan faces significant risks if China were to completely cut off the island’s energy supplies, highlighting its vulnerability amid Beijing’s territorial claims, reported Business Insider on Thursday.
“When you turn off a fab, it doesn’t come back on for 90 days, said Gelsinger.
“The economic impact of a brownout of Taiwan is greater than the Great Depression in the world,” h.e added.
Intel’s Costly Leadership Mistakes
Gelsinger also attributed the decline of the company to its non-technical leadership. He claimed that when he rejoined the company in 2021, he was the “first technical leader in essentially 15 years associated with it.”
He criticized his predecessors for their non-technical backgrounds, stating that making significant technical decisions that impact billions of dollars cannot be done through a spreadsheet. He emphasized that such an approach is a poor investment unless the technology trends justify it.
Additionally, Gelsinger expressed concern over Intel’s financial strategy before his tenure. He pointed out that the company had returned approximately $79 billion to shareholders through stock buybacks and dividends from 2015 to 2020, which he implied was excessive.
Benzinga’s Edge Rankings place Intel Corporation in the 98th percentile for momentum. Benzinga’s screener allows you to compare INTC’s performance with its peers.
INTC Price Action: On a year-to-date basis, Intel stock surged 146.27%, as per Benzinga Pro. On Thursday, the stock fell 5.84% to close at $96.98.
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