Intel’s stock surged 12% on Mar. 13 after announcing Lip-Bu Tan as its new CEO. Tan, a former board member, will take over next week.

His appointment aims to help Intel recover from years of underperformance, marked by missed AI semiconductor opportunities.

Over the past five years, Intel’s stock has fallen about 60%, while the Nasdaq and S&P 500 have more than doubled.

Analysts at TD Cowen believe Tan’s industry connections could bring contracts to Intel’s foundry business, which manufactures chips for third parties. This aligns with Intel’s strategy of integrating chip design and manufacturing.

However, Intel’s market value has dropped below US$100 billion for the first time in 30 years, and sales of its Gaudi AI chips remain weak. Many analysts remain cautious, with several issuing “hold” ratings.

Tan previously led strong growth at Cadence Design Systems and has insights from two years on Intel’s board. However, analysts, including Stacy Rasgon of Bernstein, warn that a turnaround could take years.

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