Intel Stock Plunges 25% as CEO Lip-Bu Tan Warns AI Chip Demand Is Hurting Business

Intel shares fell 25% after CEO Lip-Bu Tan warned that the AI boom's insatiable demand for chips is actually hurting the company, describing the situation as "one of the most significant supply shortages in history." The stunning drop underscores how the semiconductor giant is struggling to capitalize on the artificial intelligence wave that has powered rivals like Nvidia. Tan, who took the helm earlier this year, told analysts that the supply crunch is constraining Intel's ability to meet orders and is pressuring margins across its business. The warning sent shockwaves through the market, erasing billions in market value and reigniting concerns about Intel's competitive position. Investors had hoped Tan would chart a clearer path to recovery, but the latest guidance suggests the turnaround will take longer than expected. As AI workloads reshape the chip landscape, Intel faces a critical test: adapt to the new demand dynamics or risk falling further behind. The coming quarters will reveal whether Tan's strategy can close the gap.