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Head of Intel Foundry Services resigns just as chip biz gets going

Randhir Thakur led Intel’s big bet to take on Asian foundry giants TSMC and Samsung

Exclusive The head of Intel's revitalized contract chip manufacturing business plans to step down, The Register has learned, creating a setback for the x86 behemoth's big bet to take on Asian foundry giants TSMC and Samsung as part of its comeback plan.

Randhir Thakur, senior vice president and president of Intel Foundry Services, "has decided to pursue other opportunities" but will continue to lead the business unit through the first quarter of 2023 to "ensure a smooth transition to a new leader," Intel CEO Pat Gelsinger said in an email to employees Monday that was seen by El Reg.

Intel spokesperson William Moss confirmed the news with us.

"We're grateful to Randhir for the tremendous progress IFS has made and for laying the foundation for Intel to become a world-class systems foundry," Moss said in a statement. "We wish him all the best in his new endeavors."

In his email, Gelsinger said he will share more information soon "about the new leader" for Intel Foundry Services, suggesting the company may have a successor in place — or is at least close to having one.

"Randhir has been a key member of the Executive Leadership Team for the past two and a half years and has served in several senior leadership roles since he joined us in 2017," Gelsinger wrote. "… His contributions to our [Integrated Device Manufacturing] 2.0 transformation are many, but most notable is his leadership in standing up our IFS business."

Intel revitalized its contract chip manufacturing business in early 2021 and renamed it Intel Foundry Services with the goal of competing with TSMC and Samsung, the world's two largest contract chip manufacturers that make chips for the likes of Intel rivals, including AMD, Nvidia, and Apple.

Intel Foundry Services is part of Gelsinger's plan for the semiconductor giant to double down on manufacturing and surpass TSMC and Samsung in advanced chipmaking by 2025 as part of its so-called IDM 2.0 strategy. IDM 2.0 is an evolution of Intel's traditional integrated device manufacturing model, where it manufactures chips designed in house.

In his email to employees, Gelsinger credited Thakur for establishing a "seasoned leadership team with veterans from leading foundries" like TSMC and Samsung. He added that the Intel Foundry Services leader also "secured major customer wins in the mobile and auto segments" and helped the company win the US government's RAMP-C award along with four customers for chip designs on its 18A node.

"Since Q2, IFS has expanded engagements to seven of the 10 largest foundry customers coupled with consistent pipeline growth to include 35 customer test chips," Gelsinger said. "This is tremendous progress in only 20 months!"

Thakur recently stated that he hopes Intel Foundry Services will eclipse Samsung's contract chip manufacturing business by 2030.

However, the division brings in little revenue right now. In the third quarter, Intel Foundry Services only generated $171 million, which amounted to roughly 1.1 percent of the company's $15.3 billion in revenue for that period. ®

Updated to add

Intel is expected to get a boost in foundry business through its pending $5.4 billion acquisition of Israeli chip manufacturer Tower Semiconductor, which specializes in making high-value analog semiconductor components for markets such as automotive, medical, industrial, consumer, and aerospace and defense.

The deal is expected to close in the first quarter in 2023, and it’s one of the main reasons Thakur has agreed to remain the leader of Intel Foundry Services through that period, according to Gelsinger.

Analysts responding to the news of Thakur’s resignation said the move is likely happening because Intel plans to put Tower Semiconductor’s management in charge of Intel Foundry Services.

A month ago, Intel announced that it plans to treat its chip manufacturing operations as an internal foundry, meaning it will act in the same way Intel Foundry Services will work with outside customers.

This will allow the design and manufacturing teams to operate like separate entities with their own profit-and-loss considerations. At the time, Gelsinger said this will let the business unit and design teams consider the potential impact on markets if they want to run an additional product stepping while the manufacturing team will be able to assess requests based on costs and impact on production.

“This will give us more transparency into our financial execution and will allow us to fully benchmark and drive ourselves to best-in-class foundry performance,” the CEO said in October.

Thakur’s departure is coming as Intel faces a significant financial crunch due to a contracting economy and growing competition. In its third quarter earnings release, the company said revenue fell 20 percent year-over-year and that it plans to make billions of dollars of cuts over the next few years.

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