In Hindsight, the Future is Notoriously Incorrect
Most business forecasts often turn out wrong, but analysts and companies keep churning them out. Are forecasts doing more damages than good in the electronics market?
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Intel: Will Lip-Bu Tan Build Gelsinger’s Promised Fabs?
By Bolaji Ojo
What’s at stake:
Lip-Bu Tan’s predecessor as Intel CEO wanted to build multiple new fabs in Europe and US. Chip equipment makers, fab shell builders, political leaders and communities were counting on the planned $100 billion-plus capex splurge. Will Intel revive Gelsinger’s dreams or were they so implausible from the beginning that it’s a risk Intel must avoid?
Lip-Bu Tan’s comments at his first analysts’ conference call as CEO at Intel Corp. included an indictment of the tenure of Patrick Gelsinger, his predecessor, and even some prior leaders of the chipmaker.
Tan didn’t mention any of Intel’s five past substantive CEOs – Gelsinger, Bob Swan, Brian Krzanich, Paul Otellini and Craig Barrett – by name. He may not have meant to indict these people, but the scathing verdict delivered by Tan about what Intel has become represents a condemnation of the company’s previous leadership.
“One of my biggest learning so far is that we need to fundamentally transform our culture and the way in which we operate,” Tan said. “Organizational complexity and bureaucracies have been suffocating the innovation and agility we need to win.” Intel had developed a “siloed” operating system,” Tan said. “I’m here to fix this.”
There is a lot hanging on Tan delivering that “fix.” For this report, though, we will focus on fabrication and process development plans made by his predecessor Gelsinger, who promised to help fabless chipmakers and governments in America and Europe resolve their dependence on semiconductor fabs based in Asia. During Gelsinger’s tenure, Intel announced plans to spend a range of $100 billion to $200 billion on new fabs and back-end processing facilities, most of them to be based in the United States. What will be the fate of Gelsinger’s promised fabs, the sites selected in Ohio, Magdeburg, Germany, and plans to help fund semiconductor education at community colleges in the United States?
Read More »Intel: Will Lip-Bu Tan Build Gelsinger’s Promised Fabs?
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Infineon Bulks Up with $2.5B Marvell Ethernet Deal. Expect More
By Bolaji Ojo
What’s at stake:
Defying market turmoil, Infineon is proceeding with its growth plan. It is buying Marvell’s automotive ethernet division to beef up its software defined vehicle (SDV) and robotics offerings, but Infineon may be angling for more as it morphs from one of Europe’s top chipmakers into an even bigger global leader in other market sectors.
Two months ago, Infineon Technologies AG quietly arranged a €2 billion ($2.7 billion) revolving line of credit without disclosing why, noting only that it was benefitting from the “the strong trust” it enjoys in the banking industry.
Industry observers assumed Infineon was filling up its cash reserves to pay down debts. However, as the Ojo-Yoshida Report observed in a LinkedIn post, the company had other plans for the funds. On Monday, Infineon cleared the air, saying it offered $2.5 billion for Marvell Technologies’ automotive ethernet business. The deal, Infineon said, will be “financed from existing liquidity and additional debt.”
“This [Marvel] business holds a number one position in automotive Ethernet and offers a complete portfolio that is fully complementary to our own offering,” said Jochen Hanebeck, CEO of Infineon, during a conference call with analysts. “This deal will enable us to accelerate the transition to software defined vehicles by advancing zonal architectures based on Ethernet networks.”
Read More »Infineon Bulks Up with $2.5B Marvell Ethernet Deal. Expect More
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