Intel's CEO lays out the next steps in his major recovery strategy

Intel's CEO lays out the next steps in his major recovery strategy ...

After a long period of underperformance, Intel''s CEO Pat Gelsinger has given his outline of the next steps to revitalizing the company.

Gelsinger sketched out the next phase of Intels'' new integrated device manufacturing strategy (IDM 2.0), which is aimed at regaining unrest technology leadership, manufacturing efficiency, and long-term growth.

The objective is to integrate deep into Intel Foundry Services (IFS), a pure-play foundry division established under IDM 2.0 to compete directly with the likes of TSMC, mainly by manufacturing semiconductors designed by third-parties.

Road to recovery

Although Intel remains a monolith of the semiconductor industry, it has experienced a difficult time of late, in which it has broken down the pecking order in both manufacturing and design.

While Gelsinger''s return in early 2021 appeared to rekindle growth, a series of setbacks have illustrated the problems Intel continues to face.

The introduction of the next-generation range of server processors, known as Sapphire Rapids, has been hampered by delays. Nevertheless, Intel''s latest foray into the GPU has come to an end.

Intel published a disastrous quarterly earnings report in July, which included a 22 percent drop in revenue year on year. So bad was the performance, and Gelsinger submitted on Twitter to issue a public apology: This quarters results were below the standards we have set for the company and our shareholders. We must and will do better, he wrote.

The key objective of the program to halt Intel''s discovery division is to accelerate the expansion of Intel''s foundry division, which will now operate virtually in isolation from the internal design team and other business units.

Gelsinger claims that a strategy is to establish consistent processes, systems, and guardrails between our business division, design and manufacturing teams.

This will enable us to identify and address structural shortcomings that exist in our current model by rebringing accountability and costs back to decision-makers in real time. It will also place Intels product groups on a similar base as external Intel Foundry Services customers and vice versa, according to the author.

We will also create a foundry accounting model that integrates manufacturing, technology development, and Intel Foundry Services. This will help us gain greater transparency in our financial execution and will enable us to fully benchmark and drive ourselves to the best-in-class foundry performance.

Separately, Intel has established a new IDM 2.0 Acceleration Office (IAO) headed by Stuart Pann, the SVP of Corporate Planning, which will be charged with instilling the new-look foundry technique described by Gelsinger.

Gelsinger promised regular updates on the progress of these projects as part of a final rallying call and advising employees that now is the time to take action as One Intel hopes to unleash its full potential.