On August 7, U.S. President Donald Trump called for the immediate resignation of Intel CEO Lip-Bu Tan, citing “serious conflicts of interest” related to his past investments in Chinese tech firms. The statement, posted on Trump’s Truth Social platform, has cast a cloud over Intel’s ongoing transformation under Tan’s leadership.

Trump’s remarks follow an August 5 letter from Republican Senator Tom Cotton to Intel Chairman Frank Yeary, raising compliance concerns over Tan’s prior investments in Chinese semiconductor and tech companies. Cotton questioned whether Intel had fully vetted Tan’s financial ties before appointing him as CEO, and whether these links conflict with national security commitments tied to U.S. subsidies.

Tan, a Malaysian-born ethnic Chinese who studied at MIT and holds an MBA from the University of San Francisco, is a renowned figure in the global semiconductor industry. He previously served as CEO and Executive Chairman of Cadence Design Systems and is a founding partner of Walden Catalyst Ventures and chairman of Walden International.

Reuters reported earlier this year that Tan, through Walden International and related entities, invested over $200 million into more than 600 Chinese companies between 2012 and 2024. Some of these firms have reported ties to China’s state sector, including early investments in SMIC and partnerships with China Electronics Corporation.

Under new U.S. Treasury rules that took effect on January 2, 2025, American investments in sensitive technologies—including semiconductors and AI—in "countries of concern" like China are tightly restricted. Although Tan claims to have divested from Chinese entities, several Chinese databases still list him as a shareholder in many of them, raising further questions about compliance.

In his letter, Senator Cotton asked Intel to clarify whether its board was aware of past legal issues involving Cadence under Tan’s leadership, and whether Tan has fully severed ties with any Chinese entities that could pose conflicts of interest. Cotton also referenced Intel’s role in the U.S. government's “Secure Enclave” initiative, which includes up to $3 billion in federal subsidies for producing secure chips for defense and intelligence applications.

“The American taxpayer deserves assurance that national security funds are handled responsibly,” Cotton wrote, urging Intel to respond by August 15.

Tan assumed the role of Intel CEO on March 18, becoming the first ethnic Chinese leader in the company’s history. He immediately began a sweeping overhaul to address Intel’s financial crisis and technological lag behind competitors like TSMC. Measures include a 15% global workforce reduction in Q2, with plans to reduce headcount by 22% by late 2025, as well as canceled or delayed fab construction projects in Europe and the U.S.

In the company's recent Q2 earnings call, Tan reaffirmed his commitment to Intel’s next-gen 18A process node and announced development of 14A as a foundry-first technology, in collaboration with external customers. Despite these efforts, Intel remains behind in both advanced logic manufacturing and AI chip competitiveness.

Intel’s stock dropped nearly 5% in pre-market trading following Trump’s comments.

In a late Thursday statement, Intel firmly rejected Trump’s call for Tan to step down. “Intel, its board, and CEO Lip-Bu Tan are fully committed to advancing America’s national and economic security interests,” the company stated. “We are making historic investments aligned with the president’s America First agenda. Intel has manufactured in the U.S. for 56 years and continues to invest tens of billions in domestic R&D and advanced manufacturing—including our new fabs in Arizona, which will operate the most advanced U.S. logic process technology.”

Industry analysts are divided. Stacy Rasgon, senior analyst at Bernstein Research, noted: “Lip-Bu Tan’s activities in China aren’t secret—he’s a legendary figure in semiconductors. Intel was in crisis when he took the job, and turning it around won’t be easy.”

With Tan just five months into his tenure, Intel now faces not only the challenges of catching up in chipmaking and AI but also renewed political scrutiny that could complicate its recovery efforts.