Intel forsaking its past and losing its future

Intel, once among the world’s leading technology companies, is struggling. Founded as a start-up in 1968, the US chipmaker grew to success over the years through savvy business and technology decisions combined with timely product investments.

Led by a brilliant founding team, the company quickly developed an outstanding reputation for building and protecting its market-leading position through the development of intelligent equipment and timely innovative products.

But those glory days are mainly gone. Today, Intel is fast losing competitive ground to overseas rivals while struggling to remain among the world’s leading chipmakers in an era rich with new opportunities.

Many competitive factors have undermined Intel’s position but perhaps the most important has been the company’s change in strategy.

Intel’s founders were brilliant strategists focused on maintaining global technology leadership through timely, forward-looking investments. This objective, met time and time again, achieved outstanding financial returns.

Then came along increasingly smart foreign competition that targeted Intel’s core products, decreasing their profitability. Senior management’s response has been to broaden the company’s product portfolio via acquisitions aimed at improving profitability – often at the expense of internal investment in improving manufacturing performance and new product development.

The results of this strategic shift are now apparent. Intel’s manufacturing performance has demonstrably slipped vis-à-vis rivals like Taiwan’s TSMC and South Koreas Samsung, while few, if any, of the acquisitions have built new market momentum or company profitability.

Meanwhile, Intel has mainly missed the boat on AI’s spectacular growth,