Intel’s Former CEO Pat Gelsinger Says He Underestimated The Impact of AI — A Misstep That Left Team Blue Struggling to Catch Up

Well, Intel’s ex-CEO did acknowledge the company’s “delayed” response towards AI, as he has now claimed that the impact of the technology was miscalculated at his time.

Intel’s Misjudgment Towards AI Might Have Cost Them Billions In Revenue, Giving Competitors All The Leverage

If you look at what Intel has done with AI, it has been nothing short of disappointment, especially in the realm of AI accelerators and rack-scale solutions, since even after several years, Team Blue has failed to present a competitive solution. Sure, the company does offer its Gaudi AI accelerators to the market, but they have witnessed little adoption from cloud companies, which shows that Intel isn’t near to competitors at all when it comes to the hottest industry. Now, in a report by Nikkei Asia, it is revealed that Intel’s former CEO Pat Gelsinger has admitted to the company’s lackluster approach towards AI during his tenure.

I and pretty much everybody underestimated the impact of artificial intelligence. If you look at AI chips today, the performance of the chips has continued to increase for AI computation, but the power efficiency of those chips hasn’t changed for three generations.

Intel’s reluctance towards AI is much more evident when Gelsinger initially presumed “inference” to be everything, when NVIDIA and others were busy with model training. Intel’s ex-CEO at that time claimed that the firm was ready to capitalize on the inferencing demand when it came, and even called out CUDA as a “moat”. Despite such claims, we never really saw anything from Intel in the AI segment worthy of competing with NVIDIA, except for their Xeon server CPUs, mainly since they were a “multi-decade” product of Team Blue.

Fast forward to what is happening with Intel and AI right now. The company’s optimistic accelerator project, Falcon Shores, had been canceled, and the new CEO is looking to enter the rack-scale market with Jaguar Shores. Competitors like NVIDIA and AMD have already been offering their solutions for many years now, and Intel is nowhere to be seen in an industry that has generated hundreds of billions over the past quarters. And now, Team Blue is struggling to maintain its current business, let alone expand into new frontiers.

Interestingly, Intel’s ex-CEO still believes that having an internal semiconductor manufacturing unit is the way to approach product design, despite the financial obligations it carries. Intel has been heavily criticized for its “IDM 2.0” strategy, and it seems like the new CEO, Lip-Bu Tan, is decoupling from it by focusing less on the foundry business and more on design, one of Intel’s core businesses. It is certain that we are going to see drastic changes with Intel moving into the future, one that would likely have noticeable consequences.