Intel stock drops after Trump demands its CEO 'resign immediately,' calling him 'highly conflicted'
President Donald Trump called on Intel CEO Lip-Bu Tan to resign on Thursday, adding to the challenges facing the largest US chipmaker.
Trump called Tan "highly CONFLICTED" in a post on Truth Social, saying that he "must resign, immediately. There is no other solution to this problem."
Intel shares fell 5% in premarket trading following Trump's post. Its share price was down over 3% as of 11 a.m. in New York.
Trump's missive came two days after Sen. Tom Cotton wrote a letter to the company's board of directors raising questions about Tan's reported investments in and ownership of Chinese companies, including some with alleged ties to the Chinese military.
In April, Reuters reported that Tan had invested in hundreds of Chinese companies, including eight with ties to China's People's Liberation Army.
An Intel spokesperson at the time told Reuters that "we handle any potential conflicts appropriately and provide disclosures as required by SEC rules" and that Tan had filled out questionnaires requiring disclosure of any potential conflicts of interest.
Sen. Tom Cotton, an Arkansas Republican, also called attention to the fact that prior to becoming Intel CEO in March, Tan was the CEO of Cadence Design Systems, a company that pleaded guilty last week to illegally exporting technology to a Chinese military university. Cadence Design Systems agreed to pay $118 million in criminal penalties.
Intel received a roughly $8 billion grant from the US government under the CHIPS and Science Act, a 2022 law designed to boost the American chip manufacturing industry.
"Intel is required to be a responsible steward of American taxpayer dollars and to comply with applicable security regulations," Cotton wrote. "Mr. Tan's associations raise questions about Intel's ability to fulfill these obligations."
Trump's call for Tan's resignation was quickly backed up by two GOP senators — Bernie Moreno of Ohio and Rick Scott of Florida.
It's the latest challenge for the company, which recently warned that it could stop developing its 14A chip if it's "unable to secure a significant external customer and meet important customer milestones."
The former tech giant has been battling high volatility in the stock market all year, as it faces steep competition from rivals. Wall Street sentiment toward Intel remains mixed but skews negative, with the majority of analysts maintaining either sell or hold ratings, according to data from Markets Insider.
A White House official told Business Insider that Trump "remains fully committed to safeguarding our country's national and economic security. This includes ensuring that iconic American companies in cutting-edge sectors are led by men and women who Americans can trust."
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