Intel's Defense Against Activist Investors
- Intel has hired Morgan Stanley and other advisers to defend itself against activist investors.
- With Intel's stock dropping almost 60% this year, the company is preparing for a battle to address investor pressure.
- The move indicates Intel's efforts to protect its interests amidst shareholder demands.
Intel Corporation is reportedly collaborating with financial advisors, including Morgan Stanley, to navigate challenges posed by activist investors as CEO Pat Gelsinger seeks to revitalize the struggling chipmaker. Morgan Stanley has a history of working with Intel, notably during the 2022 spinoff of Mobileye. Sources familiar with the situation, who requested anonymity, indicated that both Intel and Morgan Stanley declined to comment on the ongoing discussions. The semiconductor giant has faced significant setbacks, losing its status as the largest U.S. chipmaker by revenue last year to Nvidia, which has surged in value due to its success in the artificial intelligence sector. Nvidia's market capitalization now exceeds $3 trillion, dwarfing Intel's, which has also fallen behind competitors such as Advanced Micro Devices, Broadcom, Qualcomm, and Texas Instruments. In a bid to streamline operations, Intel recently announced a workforce reduction of approximately 15%, equating to 15,000 jobs, as part of a broader $10 billion cost-cutting initiative. The company’s latest quarterly results fell short of Wall Street expectations, and it has opted not to issue a dividend for the upcoming fiscal fourth quarter. Historically, Intel has struggled to capitalize on emerging markets, missing out on the smartphone boom prior to Gelsinger's leadership. The company’s board has faced recent turbulence, highlighted by the resignation of Lip-Bu Tan, a semiconductor veteran, after just two years. Tan cited personal reasons for his departure but expressed continued support for Intel's mission.