Intel CEO Lip-Bu Tan made a shocking admission, saying it’s now “too late” for Intel to catch up in the AI race, as the company falls out of the top 10 semiconductor companies. Once a leader in chipmaking, Intel now faces massive layoffs, a $16 billion loss, and increasing reliance on TSMC for chip production. The company has lost ground to rivals like Nvidia, AMD, and Apple, especially in AI and data centers. With a renewed focus on edge AI and agentic systems, Tan promises change, but Intel’s future remains uncertain. Read how the tech giant plans to reinvent itself.
made a brutally honest admission—he believes it’s already “too late” for Intel to catch up in the AI competition. The statement, shared during a global employee Q&A, reveals just how far the tech giant has fallen, even slipping out of the top 10 semiconductor companies by Tan’s own words. This sharp self-assessment highlights the company’s struggle to stay relevant amid fierce competition from AMD, Nvidia, Apple, TSMC, and Samsung. While Intel still holds legacy clout, that alone may not be enough to power through the rapidly evolving AI era. And with layoffs underway and massive losses stacking up, the pressure to turn things around has never been greater.
Despite having the resources and infrastructure once deemed untouchable, Intel has fallen behind in the AI hardware race. Lip-Bu Tan’s comment—"On training, I think it is too late for us"—makes it clear that Nvidia’s runaway success in data center GPUs has created a gap that may now be impossible to close.
AI development today heavily depends on powerful training hardware, most of which runs on Nvidia’s CUDA-based ecosystem. While Intel tried to enter this space with its Habana Labs acquisition and Gaudi AI chips, it never gained the market traction needed to compete with Nvidia's H100s or AMD's MI300X chips. The rise of large language models like OpenAI’s ChatGPT only widened the gap, further cementing Nvidia’s lead.
Instead of pushing further in data center AI, Intel plans to pivot towards edge AI, focusing on bringing artificial intelligence to personal devices like laptops, desktops, and embedded systems—where it still sees growth potential.
In what’s perhaps the most jarring part of Tan’s talk, he reportedly said: “Twenty, 30 years ago, we were really the leader. Now I think the world has changed. We are not in the top 10 semiconductor companies.” This admission shocked many across the tech industry. While Intel is still a recognized name globally, competitors like TSMC, Nvidia, Samsung, Apple, and AMD have outpaced it in terms of innovation, revenue, and market relevance. Even relatively smaller firms like Broadcom, MediaTek, Micron, and SK Hynix are making waves in specialized markets. According to recent financial data, Intel reported a $16 billion loss in Q3 of 2024, and it’s struggling to reverse the trend. The company that once nearly acquired Nvidia for $20 billion is now watching from the sidelines as Nvidia crosses a staggering $4 trillion market cap. Intel’s decision to exit the AI training chip space comes as the AI chip market explodes in value. Key stats: Meanwhile, AMD is quickly gaining ground with its MI300 series, and TSMC is dominating as the primary chip manufacturer for Nvidia, Apple, and AMD. While conceding the AI training space, Intel is attempting a pivot: This move aims to revitalize Intel’s role as a domestic foundry powerhouse, producing edge and agentic AI chips rather than competing directly with Nvidia’s data center dominance.
| Company | AI Focus Area | Market Position | Key Advantage |
| AI training & inference | ~90% market share | Dominant CUDA software ecosystem, H100/Blackwell chips |
| Data center AI GPUs | Rising rapidly | Competitive MI300X chips with increasing adoption |
| Manufacturing/foundry | Backbone of AI industry | Manufactures chips for Nvidia, AMD, Apple |
| Edge AI (future focus) | Minor AI share | Investing in U.S. fabs, but far behind in AI chips |
Intel’s once-vibrant CPU leadership has failed to translate into GPU or AI-specific success. Analysts note that even if Intel builds capacity, it lacks the software stack, developer loyalty, and ecosystem that power Nvidia’s moat. Intel now hopes to find success in: However, these bets are long-term, with profitability and success far from guaranteed. A big part of Intel's decline can be traced to delays in its own chipmaking technology. While AMD partnered with TSMC to produce cutting-edge 5nm and 3nm chips, Intel stuck with its internal foundries. Unfortunately, those fabs fell behind schedule.
Intel's own hybrid architecture, similar to ARM’s big.LITTLE design, didn’t take off the way it had hoped. Its Arrow Lake and Meteor Lake CPUs failed to gain significant ground on AMD’s Ryzen and EPYC series, especially in high-performance computing. AMD now powers everything from handhelds like the Steam Deck and Rog Ally X, to gaming consoles like the PlayStation 5 and Xbox Series X/S.
Meanwhile, Intel’s attempts at entering the discrete GPU market with its Arc lineup were too little, too late. The GPUs suffered from driver issues, performance gaps, and poor market timing. By the time Intel showed up, Nvidia and AMD had already cornered the market.
There’s growing speculation that Intel may split into two entities—one focused on designing chips (like AMD and Apple) and the other running its foundry operations as a separate business. While nothing has been confirmed officially, the strategy could relieve some pressure and allow Intel to act more flexibly.
As of 2025, Intel already outsources about 30% of its chip production to TSMC, a move that would have been unthinkable years ago. TSMC is now producing major parts of Intel’s upcoming Lunar Lake and Meteor Lake chips, including the GPU and compute tiles. Intel’s long-delayed 18A node—the supposed game-changer—isn’t expected to be ready until late 2026.
This shift to a fabless model, or something close to it, could be Intel’s path to survival. Both AMD and Apple have succeeded by focusing entirely on chip design and leaving manufacturing to TSMC. Nvidia has always followed this model, too.
To cut costs, Intel has been laying off thousands of employees globally. These layoffs come as part of a larger cost-cutting initiative after heavy R&D spending and failed product launches. According to OregonTech, the company is in "a fight for survival."
CEO Lip-Bu Tan, who replaced former chief Pat Gelsinger in late 2024, has signaled a major cultural reset. He emphasized that Intel’s comeback would be a “marathon”, not a sprint. The new approach? Fewer distractions and a laser-sharp focus on areas where Intel can still compete—namely edge AI, low-power computing, and eventually reclaiming performance leadership in CPU markets.
Tan is also betting big on agentic AI, a fast-growing field where AI systems can operate independently without constant human input. He teased that more executive-level hires are coming to help accelerate the transformation, saying, “Stay tuned. A few more people are coming on board.”
The honest reality is, Intel has already missed the first AI wave. Nvidia owns the training market. AMD is now winning in data centers. TSMC continues to dominate manufacturing. Even Apple’s M-series chips are setting new standards in efficiency and performance.
Still, Intel isn’t dead. It’s wounded—yes—but not out. With the right leadership, sharper product focus, and a little humility, the company could still stage a comeback. The road ahead won’t be easy, and it won’t be fast. But if there’s one thing we’ve seen from tech turnarounds, it’s that big brands can rise again—if they’re willing to let go of the past.
Intel’s survival now depends on its ability to adapt—not just to AI, but to a world where speed, specialization, and scale matter more than legacy. The next 18 months will likely determine whether the company can climb back into relevance, or fade deeper into the background.
Intel CEO Lip-Bu Tan said Intel missed the AI training wave led by Nvidia and can't catch up now.
No, according to Tan, Intel is no longer among the top 10 semiconductor firms globally.
