Intel on Wednesday named tech industry veteran Lip-Bu Tan as its new chief executive after the previous lead departed late last year, sending the shares of the U.S. computer chipmaker, which was struggling to catch up in the AI race, soaring on the news.
Tan told the Intel team his focus would be on engineering, saying it "won't be easy" to overcome the challenges faced by the company.
Tan, who was born in Malaysia, will start as Intel chief on March 18, according to the company.
Shares were up more than 10% in after-market trade.
Intel is one of Silicon Valley's most iconic companies, but its fortunes have been eclipsed by Asian powerhouses TSMC and Samsung, which dominate the made-to-order semiconductor business.
The company was also surprised by the emergence of Nvidia, a graphics chip maker, as the world's preeminent AI chip provider.
Nvidia's strength lies in chips for powering AI, which are coveted by tech companies competing in that technology.
Intel's niche has been in chips used in traditional computing processes, which are being eclipsed by the AI rage.
Tan's predecessor, Pat Gelsinger, was forced out as Intel chief in December after the board lost confidence in his plans to turn the company around.
Gelsinger's abrupt departure came just months after the company vowed to cut more than 15,000 jobs in a draconian cost reduction plan and paused or delayed construction on several chipmaking facilities.
"I believe with every fiber of my being that we have what it takes to win," Tan said in a message to his team, vowing that Intel will be an engineering-focused company.
"In areas where we are behind the competition, we need to take calculated risks to disrupt and leapfrog."
While chief of Cadence Design Systems from 2009 to 2021, Tan transformed the company and more than doubled its revenue, according to the Intel board.
Former U.S. president Joe Biden's administration last year finalized a $7.9 billion award to Intel as part of an effort to bring semiconductor production to U.S. shores.
But Intel in February extended the timeline for completing two new fabrication plants in Ohio, saying it is taking a prudent approach to the $28 billion project.
"We will continue construction at a slower pace while maintaining the flexibility to accelerate work and the start of operations if customer demand warrants," Intel Foundry Manufacturing general manager Naga Chandrasekaran told Intel employees at the time.
For the full year of 2024, Intel recorded a net loss of $18.8 billion as the U.S. chip giant continues to struggle to stake its place in the artificial intelligence revolution.
In Europe, Intel said late last year that it was delaying its plans to build two mega chip-making factories in Germany and Poland as the company faces lower demand than anticipated.
Intel also said at the time that it would pull back on its projects in Malaysia.
