Trump calls Intel CEO 'highly conflicted' due to ties with China, demands his resignation

United States President Donald Trump has called on the Chief Executive Officer (CEO) of U.S. chipmaker Intel, Tan Lip-Bu, to resign "immediately", accusing him of having problematic ties to China.

In a post on Truth Social on Aug. 7, Trump called Tan "highly conflicted" due to his ties to Chinese firms, and called on him to resign immediately.

He added that "there is no other solution to this problem".

Following Trump's comments, Intel shares fell by more than 3 per cent, BBC reported.

Tan only appointed CEO recently

Tan, 65, was appointed as CEO of Intel in March.

According to Bloomberg, Tan is an industry veteran in technology and venture capital, and was assigned the role of Intel's CEO as part of efforts to improve the company's performance, which has been lagging behind other major players in the semiconductor space.

Tan recently told investors that the company would be scaling back investments in manufacturing, including in the U.S., in order to match demand from customers, BBC reported.

Intel also cut thousands of jobs earlier this year as part of efforts to "right-size" the company.

Republican Senator Tom Cotton sent a letter to Intel

Trump's comments come after Republican Senator Tom Cotton sent a letter to Intel on Aug. 5, expressing concern over Tan's investments and ties to semiconductor firms that are allegedly linked to the Chinese Communist Party and the People's Liberation Army.

In the letter, Cotton wrote:

"Mr. Tan reportedly controls dozens of Chinese companies and has a stake in hundreds of Chinese advanced-manufacturing and chip firms. At least eight of these companies reportedly have ties to the Chinese People's Liberation Army."

Cotton also pointed out that Tan was previously the CEO of tech firm Cadence Design Systems, which recently pleaded guilty to illegally exporting semiconductor design tools to the National University of Defence Technology (NUDT) in China, and paid over US$140 million (around S$179 million) in criminal penalties.

"These illegal activities occurred under Mr. Tan's tenure," he said.

BBC also reported that Tan's connections to China have drawn much attention and scrutiny.

A 2024 U.S. congressional report examining the link between American investment firms and Chinese companies spotlighted his ties to China.

In April, an investigation by Reuters revealed that Tan had invested at least US$200 million (around S$256 million) in hundreds of Chinese companies over the years.

Some of those companies were found to have ties to the Chinese military.

Intel released a statement

Following Cotton's letter, Intel released a statement on Aug. 7, titled "Our commitment to advancing U.S. national and economic security".

Intel defended its CEO, stating that "Intel, the Board of Directors, and Lip-Bu Tan are deeply committed to advancing U.S. national and economic security interests and are making significant investments aligned with the President's America First agenda".

Tan also said the chipmaker is working with the U.S. administration to address concerns and ensure accurate information.

According to BBC, Intel had received billions of dollars from the U.S. government in a bid to rebuild America's semiconductor manufacturing industry.

Responses to Trump's call for Tan's resignation are mixed

According to Bloomberg Intelligence analyst Oscar Hernandez Tejada, calls for Tan's resignation would "introduce a layer of uncertainty that could complicate execution".

The CEO of Ladenburg Thalmann Asset Management, Phil Blancato, acknowledged that Trump's opinions carry influence, but warned that it would be "setting a very unfortunate precedent" if U.S. presidents started to influence corporate leadership decisions, Reuters reported.

On the other hand, head of equity and portfolio manager at Intel shareholder Aptus Capital Advisors, David Wagner, showed support for Trump's actions.

He told Reuters that while many investors may feel that Trump is overstepping his boundaries, his actions signal that he is "very serious about trying to bring business back to the U.S."

Amid backlash over Trump's involvement, a White House official said that Trump "remains fully committed to safeguarding [their] country's national and economic security", BBC reported.

He adds that "this includes ensuring iconic American companies in cutting-edge sectors are led by men and women who Americans can trust".

Top photos via The White House/Facebook, Intel/Facebook