Intel Corp.’s incoming Chief Executive Pat Gelsinger said the semiconductor giant would outsource more chip production as it posted pandemic-fueled full-year results that also underscore the breadth of challenges the new CEO will face.
Mr. Gelsinger on Thursday said Intel would have other chip companies make more of its products, even if the bulk of its new chips in coming few years would be made in house. The shift marks a break from Intel’s traditional reliance on its own factories to make its most-advanced chips—effectively an acknowledgment that it has fallen behind chip-making rivals.
The report for 2020 caps a challenging yet lucrative year for the semiconductor giant that saw it surpassed in market valuation by rival Nvidia Corp., dropped by Apple Inc. as a supplier for Mac chips, suffer market-share losses and face a push by activist investor Third Point LLC for strategic changes.
“Intel has gone through cycles before,” Mr. Gelsinger said. “Great companies are able to come back from periods of difficulty and challenge, and they come back stronger, better and more capable than ever. And that, I believe, is the opportunity at Intel.”
The pandemic has helped Intel paper over some of its challenges. Demand for PCs and the chips that go into them hasn’t been this hot in years.
