Taiwan Semiconductor Manufacturing Co (NYSE:TSM) founder Morris Chang told Reuters Monday that Intel Corp (NASDAQ:INTC) should have focused on developing its artificial intelligence moat instead of contract chipmaking.

Chang’s comments followed Intel chief Pat Gelsinger’s departure after he failed to impress the board with his turnaround efforts. Intel stock has plunged 58% year-to-date.

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During Chang’s autobiography launch event, he emphasized the need for a new strategy and CEO for Intel.

Gelsinger’s turnaround efforts involved making the fastest and most minor computer chips for other companies, but Taiwan Semiconductor eventually overtook this advantage. Taiwan Semiconductor stock surged over 89% year-to-date.

Chang said Intel lost or canceled contracts with major clients while aiming for ambitious manufacturing and AI capabilities.

On Tuesday, S&P Global Ratings downgraded Intel’s credit rating to ‘BBB’ from ‘BBB+ citing weak business recovery and uncertainty following Gelsinger’s exit.

However, the firm expects Intel’s client computing segment to post growth after a modest recovery in 2025 backed by the PC refresh cycle and its Data Center and AI (DCAI) and Networking and Edge segments.

Intel interim co-CEO David Zinsner expects the next CEO to be equipped with manufacturing and product skills.

Investors can gain exposure to Intel through First Trust Nasdaq Semiconductor ETF (NASDAQ:FTXL) and REX FANG & Innovation Equity Premium Income ETF (NASDAQ:FEPI).

Price Action: INTC stock traded higher by 0.20% at $20.20 at premarket Wednesday.

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