Washington: President Donald Trump has called on the head of US chipmaker Intel, Lip-Bu Tan, to resign "immediately", accusing him of problematic ties to China. In a social media post, Trump described Tan as "highly conflicted", referencing alleged investments in companies the US claims are linked to the Chinese military. It is an unusual move for a president to demand the resignation of a corporate executive.
According to BBC, Lip-Bu Tan, who was appointed in March, has been tasked with revitalizing the tech giant, a pioneer in the US chips industry that has recently been outpaced by competitors. Tan, a naturalized US citizen born in Malaysia and raised in Singapore, is a venture capitalist known for his expertise in the semiconductor industry. In a recent update to investors, he announced Intel's plans to scale back investments in manufacturing, including in the US, to better align with customer demand. This year, Intel has already cut thousands of jobs to "right-size" the firm.
After Trump's public criticism, shares in Intel dropped more than 3% by midday. Trump, who has previously criticized the firm, is preparing to increase tariffs on the chip industry. He stated, "The CEO of INTEL is highly CONFLICTED and must resign, immediately. There is no other solution to this problem." While it is not illegal for Americans to invest in Chinese firms, Washington has increased restrictions since Trump's first term, aiming to sever business ties between the US and China in advanced technology sectors due to national security concerns.
Trump's comments echoed concerns from Republican Senator Tom Cotton, who, in a letter to Intel's board, questioned Tan's "associations" and Intel's ability to be a "responsible steward of American taxpayer dollars and to comply with applicable security regulations". Cotton highlighted Tan's prior role as chief executive of Cadence Design Systems, which pleaded guilty in July to US charges over its Chinese subsidiary's dealings with China's National University of Defense Technology. Tan was not indicted.
Intel defended its CEO, stating that both Tan and the company are "deeply committed to the national security of the US and the integrity of our role in the US defense ecosystem". Industry expert Patrick Moorhead suggested that Trump might be leveraging the controversy over Tan's China ties to pressure Intel on other issues, such as its US investments and a possible partnership with Taiwanese firm TSMC backed by the White House. "Trump probably saw, Ok, I've got an opportunity to turn up the heat with Intel on this," Moorhead said.
Trump's approach to publicly criticizing business leaders is unprecedented. Other tech executives targeted by Trump have often responded with promises of large investments in the US. Moorhead suggested that Intel "probably misread the room" in terms of engaging with the White House.
The White House responded to critics by reaffirming Trump's commitment to safeguarding national and economic security, emphasizing the importance of trusted leadership in iconic American companies. Tan's ties to China were highlighted in a 2024 congressional report on US investment firms and Chinese businesses, as well as a Reuters investigation that revealed Tan's investments in Chinese companies, some linked to the Chinese military, from 2012 to December 2024.
Republican Senator Bernie Moreno, a Trump ally, joined the criticism of Tan, targeting Intel for delays in US chip manufacturing plans. The clash with Trump adds to the challenges Intel and the US chip manufacturing industry face. Janet Egan, a senior fellow at the Center for a New American Security, stated, "Intel has been a hope for America to build out more chip capacity and has struggled to do so to date. It's important that we get continuity of leadership to support that ramping up of capacity."