Intel: New Compensation Plan, New CEO, and a Strategy for the Future

What are the recent changes at Intel?

In recent months, Intel has undergone several significant changes aimed at strengthening its position in the competitive chip market. One of the most notable steps was the approval by shareholders to expand the company’s equity incentive plan. This decision is intended to improve Intel’s ability to recruit and retain talented employees, especially at a time when competition for talent in the technology sector is increasing.

In addition, in March 2025, Lip-Bu Tan was appointed CEO of Intel after the board of directors lost confidence in the previous CEO’s recovery plan. This appointment signals a new direction for the company, with an emphasis on renewal and improved performance. These changes reflect the challenges facing Intel and the attempt to address them effectively.

What is Intel’s new equity incentive plan and why was it approved?

Intel’s new equity incentive plan, approved by shareholders on May 6, 2025, is a key tool in the company’s strategy to attract and retain the best employees. The plan expands the pool of shares available for distribution to employees, allowing Intel to grant its employees restricted stock units (RSUs) and options. The goal of the plan is to align the interests of employees with those of shareholders, so that the company’s success translates directly into rewards for employees.

The decision to expand the equity incentive plan was made against the backdrop of intense competition in the chip market. Many technology companies are struggling to recruit and retain top technological talent, and Intel is no exception. By offering attractive equity compensation, Intel hopes to position itself as an employer of choice in the industry, attracting top-tier engineers, scientists, and other professionals.

In addition, the new equity incentive plan is designed to incentivize employees to make special efforts to improve the company’s performance. When employees have a stake in the ownership of the company, they are more likely to see its success as a personal success and act accordingly. The new equity incentive plan is part of a broader strategy by Intel to improve performance and address growing competition in the chip industry. By investing in its employees, Intel believes it can gain a competitive advantage and ensure its long-term success.

Who was appointed as the new CEO of Intel and what does his compensation package include?

In March 2025, Lip-Bu Tan was appointed CEO of Intel after the board of directors lost confidence in the previous CEO, Pat Gelsinger’s, recovery plan. Tan brings with him a wealth of experience in the chip industry, and he is seen as someone who can lead Intel into a new era of growth and innovation. His appointment reflects Intel’s desire to make significant changes in senior management in order to address the challenges it faces.

Tan’s compensation package is designed to incentivize him to achieve impressive results for the company. He receives a base salary of $1 million per year, but the most significant part of his compensation package is the equity awards, which can reach a value of up to $42 million, depending on the company’s stock performance. This compensation structure ensures that Lip-Bu Tan will be committed to the company’s long-term success, and that his actions will focus on maximizing value for shareholders.

Intel’s board of directors believes that Lip-Bu Tan is the right person to lead the company during this challenging time. His experience in the chip industry, along with the performance-based compensation package, should provide him with the incentives and resources needed to succeed. This appointment marks a new beginning for Intel, and it raises hopes among investors and employees alike.

How will organizational changes and a focus on AI affect Intel?

Upon taking office, the new CEO, Lip-Bu Tan, immediately began implementing organizational changes aimed at streamlining the company’s operations and improving its competitiveness. One of the first steps taken was to reduce management layers, a move designed to make decision-making processes faster and more efficient. In addition, Tan emphasized increasing operational efficiency, with the aim of reducing costs and improving the company’s profitability.

In addition to organizational changes, Tan introduced an ambitious plan to rehabilitate Intel’s artificial intelligence (AI) field. He identified the AI field as having significant growth potential, and determined that Intel should aim to reposition itself as a leading player in this field. The plan includes increased investment in research and development of new AI technologies, as well as collaborations with start-up companies and other technology companies.

These moves are expected to strengthen Intel’s position in the personal computing and data center markets. By improving operational efficiency and focusing on innovation in the field of AI, Intel hopes to gain a competitive advantage over its rivals and increase its market share. The impact of organizational changes and a focus on AI will be crucial to Intel’s future.

What financial challenges does Intel face and how has the market responded?

Despite the strategic steps taken, Intel still faces significant financial challenges. One of the main challenges is a decline in revenue from chip sales to data centers, an area that was previously a key growth engine for the company. In addition, Intel faces increasing competition from companies such as AMD and Nvidia, which offer more advanced chips at competitive prices.

The market has responded negatively to the recent news, with Intel’s stock falling by 1.6% on the day of the decision to appoint the new CEO and expand the equity incentive plan. This decline completed a 36% drop in the past year, reflecting investors’ lack of confidence in Intel’s ability to recover and return to growth.

What is the significance of these changes for the future of Intel?

The approval of the new equity incentive plan and the appointment of Lip-Bu Tan as CEO are important milestones in Intel’s efforts to restore its competitive position and regain investor confidence. These steps demonstrate the company’s determination to make significant changes and return to a path of growth.

However, realizing the potential of these moves depends on consistent implementation, streamlining, and a return to financial growth in a changing technological era. Intel faces significant challenges, but with new leadership and a clear strategy, it has a good chance of overcoming them and securing its future as a leading company in the chip industry.