Intel CEO Lip-Bu Tan said the company will spin off its non-core businesses in an effort to get back to its roots and make up lost ground.

Tan was recently appointed CEO after stepping down from the board in 2024 over disagreements about the direction the company was headed under then-CEO Pat Gelsinger. According to Bloomberg, Tan made his comments at the Intel Vision conferencing Las Vegas on Monday.

“We have a lot of hard work ahead,” Tan told customers in the audience. “There are areas where we’ve fallen short of your expectations.”

“We fell behind on innovation,” Tan added. “We have been too slow to adapt and meet your needs.”

One of the big questions hanging over Intel is whether it would sell its fledgling foundry business, a main focus of Gelsinger’s tenure, or try to remain whole. Tan seemed to indicate that he had no intention of selling either part of the company’s core business, but did say units that were not part of Intel’s core could be spun off.

A Cultural Change To Intel’s Foundry Business

Intel has scored some high-profile contracts for its foundry business, such as Amazon and MediaTek, but has struggled to attract others. Qualcomm and Tesla both opted against using Intel because of the company’s technical missteps and/or its inability to deliver exactly what was needed.

Gelsinger himself identified the issue in an interview in mid-2023.

“Foundry is a service business,” Gelsinger said. “That isn’t the culture that Intel’s had.”

Tan seems intent on succeeding where Gelsinger failed change that culture. Bloomberg reports the CEO made clear that Intel will listen to prospective customers, letting them tell Intel what they need rather than the company dictating how things should be done.

Tan is a respected figure within the semiconductor industry, and for a time was one of the only board members with solid industry experience. While Tan warns that Intel’s issues won’t be fixed overnight, he’s confident he can turn things around, which was the driving reason for accepting the job.

“It was very hard for me to see it struggle,” Tan said. “I simply could not stay on the sidelines knowing that I could help.”

“It won’t happen overnight, but I know we can get there,” he added.