Intel's performance Waterloo: The dilemma and future puzzle under Kissinger's leadership

Recently, global tech giant Intel seems to be having a tough time. Just recently, Intel released its Q3 2024 financial report. Data shows that Intel's performance declined by 6.2% year-on-year in the quarter. Even more shocking is that Intel incurred a net loss of $16.639 billion in the quarter.

Intel, which once led the semiconductor industry for decades, is now mired in a decline in performance and negative news is constantly emerging. After Pat Kissinger took over as CEO, the days of this American tech giant did not turn around as expected, but instead fell into an unprecedented crisis.

Since Kissinger took over Intel in 2021, his decisions seem to have failed to lead the old company out of its predicament, instead causing Intel's performance to decline all the way. The cooperation between Intel and TSMC should have been an important opportunity for Intel to regroup, but Kissinger failed to seize this opportunity. According to insiders, TSMC has offered significant discounts to Intel in hopes of deepening their cooperation. However, Kissinger chose to give up this opportunity for cooperation and instead hoped to restore Intel's own manufacturing capabilities. This decision not only missed the opportunity for Intel to deepen cooperation with TSMC, but also put Intel in a more passive position in the field of chip manufacturing.

Kissinger's decision not only failed to revive Intel, but also posed unprecedented challenges in the field of chip manufacturing. According to Intel's Q3 2024 financial report, the company's revenue was $13.284 billion, a year-on-year decrease of 6%; The net loss was as high as 16.639 billion US dollars, turning profit into loss year-on-year. The decline in this performance is undoubtedly a huge blow to Kissinger's leadership ability. Intel's predicament in the field of chip manufacturing has also sparked widespread concerns in the industry about its future development.

In Kissinger's view, Intel needs to execute at a "crazy" pace to revive the company's manufacturing capabilities. However, his decision did not bring the expected results. Intel encountered serious delays and technical issues in its attempt to regain its manufacturing leadership through the Intel 18A (1.8nm) chip production process. Some customers even refuse to use this process, which is undoubtedly a huge blow to Intel's manufacturing capabilities.

In addition to the difficulties in the chip manufacturing field, Intel also faces significant challenges among its major customers. Kissinger had high hopes for Intel's manufacturing and AI capabilities, but reality disappointed him greatly. Either losing the contract, having the contract cancelled, or being unable to deliver the promised products, these issues have greatly damaged Intel's reputation among its major customers. In the AI chip market, Intel has also failed to secure a place as expected. Although Kissinger attempted to transform Intel into a "contract manufacturer" to produce chips designed by other companies, this decision did not yield the expected results. Intel's market share in the AI chip market is constantly being eroded by competitors, which undoubtedly poses a huge threat to its future development.

Intel's predicament is not limited to declining performance and loss of market share. Under Kissinger's leadership, Intel also faced serious internal problems. The implementation of the company's restructuring and layoff plan has caused low morale among Intel employees. Kissinger's remarks on Taiwan, China and TSMC in public offended the industry. These remarks not only damage the cooperative relationship between Intel and TSMC, but also greatly undermine Intel's image in the industry.

Despite facing enormous challenges, Intel has not given up. Under Kissinger's leadership, Intel is implementing a restructuring plan to divest its chip foundry business, Intel Foundry. Although this decision may have short-term negative impacts, Intel hopes to take this opportunity to build a more streamlined and profitable company. At the same time, Intel is also working hard to promote the research and application of the 18A chip, hoping to attract more attention in the market and apply it to Intel's own client and server products.

However, Intel's future is still full of uncertainty. Against the backdrop of rapid growth in the AI server market, Intel has failed to secure a foothold. Despite Intel's efforts to promote the development of AI accelerators, there is still a long way to go before achieving profitability. In the field of chip manufacturing, Intel also faces enormous challenges. How to stand out in the fiercely competitive market and revitalize Intel's manufacturing capabilities will be an important issue that Kissinger and the Intel team need to face.

The decline in performance, loss of market share, and frequent internal problems have made Intel's future full of uncertainty. Although Intel is actively addressing challenges, its future path is still full of uncertainty. Against the backdrop of rapid growth in the AI server market, Intel is facing fierce competition from companies such as Apple. The release of Apple's M-series chips, especially the arrival of the M4 chip, undoubtedly brought tremendous pressure to Intel. At the same time, the Chinese chip industry is constantly developing and growing, with new technological breakthroughs and product innovations emerging one after another. These changes are reminding Intel that its competitors are becoming increasingly powerful, and its market share and influence are facing unprecedented challenges.