CEO says Intel is 'not a top 10' chipmaker, with no indication Ohio could help that

COLUMBUS, Ohio (WCMH) -- Intel's CEO reportedly said the company is not in the top 10 semiconductor companies, fearing it is too far behind to catch up with industry leaders.

According to a message from CEO Lip-Bu Tan shared with Intel employees and verified by The Oregonian/OregonLive, Tan fears it is "too late" to catch up in the AI game, and said turning the company around will be a "marathon." The comments come amid mass layoffs as Tan tries to make the company more profitable and competitive, but the blunt remarks underscore competitors' successes.

"Twenty, 30 years ago, we are really the leader," Tan allegedly said in a video broadcast to employees. "Now I think the world has changed. We are not in the top 10 semiconductor companies."

Tan said ongoing layoffs will help them be better aligned with competitors like Nvidia and Broadcom. As Tan points out, Intel has a wide gap to close; last week, industry leader Nvidia became the first company to reach a $4 trillion valuation. Intel's market value is about $100 billion, which is up from the end of 2024 but noticeably below its valuation one year ago.

Layoffs have not officially hit Ohio yet, although they have begun in other states like California, Arizona and Oregon. It is known that Intel's manufacturing division -- the division responsible for Ohio's plant -- will have up to 20% layoffs. See previous coverage of the latest Intel layoffs in the video player above.

Ohio's operation is much smaller than active sites in other states; as of December, Intel's Ohio One plant had 163 employees and an undisclosed number of contracted construction workers. Intel's layoffs would likely only affect official Intel employees, but the company has not announced any large layoffs in Ohio to date. Intel has not acknowledged NBC4's questions about possible layoffs in Ohio.

In his message, Tan reiterated his belief that a smaller Intel will be more productive. Since taking the helm in March, he has said Intel needs to be streamlined and has already reorganized portions of its leadership to have more people reporting directly to him.

Tan also discussed Intel's losses in the data center market and said Intel needs to adjust to meet advanced computer demands. Much of that comes from Intel's significant lag in the artificial intelligence game, which Nvidia dominates. Artificial intelligence runs on processors known as GPUs, and Nvidia supplies its advanced GPUs to Amazon, Google, Meta and most other major tech companies. Intel has no advanced GPUs and Tan said Nvidia's market is "too strong" to catch up to.

To supplement, Tan said he wants Intel to focus on "edge" AI and explore agentic AI. Edge AI develops AI algorithms on devices rather than relying on a central cloud service like those housed in data centers. Agentic AI is an emerging field and refers to AI systems that can make decisions and take action independently. Tan said he is focusing on these areas to stay competitive.

When Intel selected Ohio for its massive manufacturing plant, it had hoped its innovative new way of manufacturing semiconductor chips would bring in external customers. Recently, Intel has pivoted away from that manufacturing system, which was expected to be used at Intel Ohio One. The company has not detailed what systems will be used in Ohio once the plant is finally built.