Change of guard at Intel Foundry, again

A little more than a year after he took the reins of Intel’s ambitious bid for semiconductor contract manufacturing, Stuart Pann is retiring while handing over the charge to Kevin O’Buckley. The transition took place on Monday, 13 May, and it once more raised questions about the future viability of Intel’s third-party foundry business.

Pann, a 35-year company veteran, joined Intel during the heydays of the PC revolution in 1981. He returned to the Santa-Clara, California-based semiconductor firm in 2021 to lead the chip manufacturing division, Intel Foundry Services (IFS). He replaced Intel Foundry’s first chief, Randhir Thakur, who later became CEO and managing director of Tata Electronics, the electronics manufacturing arm of Indian conglomerate Tata Group.

Figure 1 Pann, currently in a support role for a smooth transition, will retire at the end of this month. Source: Intel

Now O’Buckley replaces Pann, and it’s a déjà vu of Thakur-to-Pann handover a year ago. For instance, during the first quarter of 2024, Intel Foundry reported revenue of $4.4 billion, which was down by $462 million compared to the first quarter of 2023. That’s mainly attributed to lower revenues from back-end services and product samples.

Pann—who left the company only a few months after Intel Foundry marked the official launch of the manufacturing business as an independent entity to compete with the likes of TSMC and Samsung—set up Intel’s IDM 2.0 Acceleration Office (IAO) to guide the implementation of an internal foundry model. IAO closely works with Intel’s business units to support the company’s internal foundry model.

Intel Foundry, which aims to move beyond traditional foundry offerings and establish itself as the world’s first open-system foundry, faces huge technical and commercial challenges. That includes combining wafer fabrication, advanced process and packaging technology, chiplet standards, software, and assembly and test capabilities in a unified semiconductor ecosystem.

O’Buckley inherits these challenges. He comes from Marvell, where he led the company’s custom chips business as senior VP for the Custom, Compute and Storage Group. O’Buckley came to Marvell in 2019 via its acquisition of Avera Semiconductor, a 1,000-person chip design company that traces its roots to IBM, which offloaded it to GlobalFoundries before it was sold to Marvell. O’Buckley led Avera’s divestiture from GlobalFoundries.

Figure 2 Like his predecessor, O’Buckley will report directly to CEO Pat Gelsinger. Source: Intel

Intel CEO Pat Gelsinger, who has bet Intel’s revival bid on setting up an independent fab business, acknowledges that Intel Foundry is still some distance away from profitability due to the large up-front investment needed to ramp it up. However, time isn’t on Gelsinger’s side, meaning a swift turnaround plan is in order for O’Buckley.

O’Buckley is an outsider, a plus at Intel, where employees are known to have stayed long years; his expertise in the custom chips business will also be an asset at Intel Foundry. Next, during his stint at IBM, he spearheaded the company’s development of 22- and 14-nm FinFET technologies. As Gelsinger puts it, he has a unique blend of expertise in both foundry and fabless companies.

Now comes the tough part, execution.

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