Intel has enlisted Morgan Stanley and other advisors to mount a defense against activist investors.

• Intel is seeking the assistance of advisors, including Morgan Stanley, to defend against activist investors, sources claim.
• This year, the chipmaker has experienced a significant decline in value, losing nearly 60%, as it faces intense competition from rivals in the field of artificial intelligence.
• Intel's board member, Lip-Bu Tan, resigned after serving for two years.

The chipmaker is working with advisors including to defend itself against activist investors, according to people familiar with the matter, as CEO Pat Gelsinger attempts to turn around the struggling company.

Intel has faced activist pressure in the past, but no new campaign has been formally launched and it is unclear if an activist investor has contacted the company's board. Morgan Stanley has previously worked with Intel, including in the company's 2022 spinoff of .

Morgan Stanley's latest involvement has been requested not to be named due to confidentiality. Intel and Morgan Stanley representatives declined to comment.

Intel lost its position as the largest U.S. chipmaker by revenue last year due to the growth of its artificial intelligence business. Nvidia, with a market cap of over $3 trillion, has surpassed Intel and is now 35 times larger. Additionally, Intel has fallen behind other companies such as AMD, Advanced Micro Devices, and Qualcomm in terms of market cap.

Intel recently announced that it will cut approximately 15% of its workforce, or 15,000 jobs, as part of a $10 billion cost-reduction plan. Additionally, the company reported quarterly results that fell short of Wall Street estimates and stated that it will not pay a dividend in the fiscal fourth quarter.

Currently, Intel faces its biggest challenge in the AI race as it lags behind in the competition, with cloud vendors and developers opting for Nvidia's GPUs for demanding tasks. In the past, Intel missed out on the smartphone market boom.

In 2020, before Gelsinger's appointment as CEO, Third Point, led by Dan Loeb, acquired a significant stake in Intel and urged the company to explore alternative strategies to address market share decline. Intel's board is headed by Frank Yeary, a renowned investment banker who previously served as executive chairman of Camberview prior to its acquisition in 2018.

This week, the board underwent some upheaval with the departure of Lip-Bu Tan, a seasoned semiconductor industry veteran, who announced his resignation on Thursday after only two years as a director.

Tan stated in a filing that this decision is personal and stems from the need to reorganize responsibilities among various commitments. Despite this, Tan remains committed to supporting the company and its crucial work.

— CNBC's Alex Sherman and Kif Leswing contributed to this report.

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