Daniel Loeb, chief executive of hedge fund Third Point LLC, wrote a letter to Intel Chairman Omar Ishrak on Tuesday calling on the chipmaker to hire an investment adviser to explore “strategic alternatives” aimed at regaining market share from competitors, particularly Taiwan Semiconductor Manufacturing Company and Samsung.
The suggestions in the letter — which include calls for the company to more seriously consider whether to continue making all of its chips in-house and divesting from “failed acquisitions” — could lead to major changes if Intel acts upon them.
“The loss of manufacturing leadership and other missteps have allowed several semiconductor competitors to leverage TSMC’s and Samsung’s process technology prowess and gain significant market share at Intel’s expense,” Loeb wrote in the letter, which was shared publicly.
Intel’s stock ended Tuesday up nearly 5% following news of Loeb’s letter. The chipmaker’s shares have fallen nearly 19% this year, even though the PC market received a boost from the shift to working from home during the pandemic.
He also urged Intel to address its “human capital management issue,” saying that many talented chip designers and leaders have left the company and those remaining are being “demoralized by the status quo.”