Quick story this AM. News broke across the wires this AM that Pat Gelsinger, CEO of Intel for the last 4 years, has resigned and is leaving the company. The company released the news on its website, where you can find the entire story. https://www.intc.com/news-events/press-releases/detail/1719/intel-announces-retirement-of-ceo-pat-gelsinger
Gelsinger worked for the tech giant for 40 years and was respected as a visionary and leader during his tenure. The Intel board is appointing two current company leaders to fill the role for now while it moves ahead quickly with the search and selection of a new leader.
With share prices still near rock bottom, the company continues to try to refocus its direction and moves towards splitting into two separate parts. One for designing leading-edge computer chips and one for building them inside its FABS and foundries it is creating. Despite these efforts, the company is a non-entity in the exploding AI market, which TSMC and NVIDIA dominate.
Mike Rogaway at Oregon Live posted a detailed story on this matter this morning. https://www.oregonlive.com/silicon-forest/2024/12/intel-ceo-pat-gelsinger-retires-abruptly-amid-chipmakers-deepening-struggles.html
Oregon and Hillsboro, we better hope the company settles down and stays relevant in the future. The Ronler Acres campus continues to be a flagship for the company in terms of production, and Gelsinger did land the 8 billion in CHIPS Act money Intel was expecting last week from the Biden administration. Up to 1.8 billion of that should find its way to another expansion at the Hillsboro facility.
On the R&D front, Intel still has the Jones Farm campus here, and while rumors of a closure swirl lightly in the winds, there is no official news. The company may close and sell the Hawthorne Farms site, as was reported recently.
There are 28 days left for the final decision on where the NAPMP Advanced Packaging Piloting Facility will be located. Hillsboro is most certainly a final candidate. That would change the immediate future of the Silicon Forest. Retraction and job layoffs have led the news headlines in the last two years. Landing a facility like that would propel job creation and revenues for years.
Two thousand twenty-four promises to finish on a wild note, with 2025 and the foreseeable future very uncertain. One thing is for sure. Gelsinger will not be a part of the story, and more than ever, Intel is in the hands of its Board and financiers.
Here is our last story on this final CHIPS Act opportunity.
It seems very likely that Gelsinger’s departure will accelerate the sell off of Intel assets, including entire campuses, which he supposedly opposed. The next target in this area certainly will be Jones Farm, since a majority of the employees there are not involved in the foundry or chip design. The ones that are will likely be relocated to Rollier, which as of 2022 had 2 entire floors in the office tower that were unoccupied. I also cannot imagine that the government would choose to the locate Advanced Packaging Piloting Facility in a region that has only one faltering chip manufacturer but would more likely select a place like Phoenix that has a multitude of silicon manufacturers, including two new gargantuan Intel and TSMC plants that are now nearly operational. Finally, I can’t envision the Chips Act continuing in the next administration, since they were openly critical of it prior to the election.
You are saying exactly what my sources have told me. They are insiders. Everytime I state what ai am being told ai am crucified by arm chair experts. Sounds like u have a good grasp on things!
Who would buy Hawthorne and Jones Farm? I guess Lattice could buy Hawthorne Farms if they end up buying Altera from Intel – but that’s still a big IF – as Lattice is right next door and they’ll need some more space if that were to go through.
Either campus would be attractive to any number of developers. The Synopsis Buildibgs just sold for a song on 17 acres. I could see Hawthorne being torn down and redeveloped into 3,500 housing units at 6 to 7 stories with MAX access and light commercial on the main level. Jones farm would have a shot at finding a user. Again is nothing else it’s 100 acres of prime land that would be valued at 1 million plus an acre. That campus might be able to be converted to a work force training center or a public school of some sort. Residential would work there too. So I am not at all worried. Do you remember Fujitsu, Epson, NEC, Komatsu, Nikon? They all left behind big buildings…some were destroyed and others repurposed. So money finds a way.
But a lot of that value is predicated on Intel being there where it is with the number of employees it currently has. If it comes down to JF being sold it would probably mean that there are many more layoffs ahead. A greatly diminished Intel (or what’s seeming more likely by the day: an Intel that’s sold off in pieces to other companies) would mean a lot less jobs in the area which seems likely to impact property prices since Hillsboro is kind of a company town. JF as some sort of educational facility for workforce training would be great, but if there aren’t any local jobs to train for? (and it’s an absolutely huge campus – is there that much demand?) Yeah, I remember Epson, Toshiba, NEC, etc having a presence, but remember that they were there mostly because Intel was there (they supported equipment in the fabs, etc) and their workforces were tiny compared to Intel’s.
Salient points. I would say we look at more of a Tektronix analogy. They had 20,000 jobs they when Beaverton was perhaps 25,000 people. They died a long slow death and others came to fill the void. And growth has been non-stop ever since. Our Valley has many redeeming qualities and a Fab like Ronler won’t disappear. Someone else will fill the void. We should be just fine.
Nvidia has a presence here. Probably the best scenario would be if Nvidia bought pieces of Intel that they’re interested in and then grow more into the area. Otherwise I don’t see a Tek -> Intel transition in the works this time. Intel was here starting in the early 80s when Tek was in it’s heyday. Whether or not Tek diminished Intel was going to grow (imagine the scenario where Tek never really diminished and still employed about 20K people here, conversely imagine a scenario where Intel didn’t get into Wintel and never really grew beyond a couple thousand employees here).
I think the Tek to Intel transition was kind of a lucky happenstance that grew out of a particular confluence of events: 1) Intel transitioned from memory to CPUs in the early 80s. 2) IBM chooses the 8086 for their PC 3) Microsoft dominates the OS market 4) Wintel becomes a thing which essentially gives Intel an almost monopoly position in the CPU market that continued until AMD started eating their lunch in the mid aughts. (and then they lost mobile and now they seem to have lost AI)
So unless some company with deep pockets comes along and buys up enough local pieces to keep things cohesive enough to stay here (Nvidia would probably be the best candidate) I’m not sure we’ll see the same level of tech employment (high paying jobs) that we’ve grown accustomed to here over the last 40 years. Not saying it’s impossible – it could happen. I just don’t see the same kind of confluence of events as the last transition.