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Michael Dunne: I'm Michael Dunne. If Oregon's first economic boom was timber, tech became the second, and leading that technology wave was Intel. But then the AI boom happened, and Intel, which didn't make the kind of chips needed for artificial intelligence, was left out in the cold. So much so that just a year ago there was speculation that the company might disappear. How much can change in a year? Today on the show, you'll hear from an Oregonian reporter and longtime follower of Intel about the company's massive turnaround, thanks in no small part to a bit of luck with those same chips once deemed obsolete. Then, in the second part of the show, we'll get updates on a new superintendent in town and the potential new tax to help the Lane County Sheriff's Office. Mike Rogoway, technology and business reporter for The Oregonian. Mike, it's always great to talk to you. Thanks so much for chatting with us.
Mike Rogoway: Yeah, thanks for having me back.
Dunne: In fact, I want to reference a conversation we had a while ago, which at times almost felt like a eulogy for Intel, or at least a severe warning about the company's future. Things seem to have changed a little bit, and nobody outside of Intel knows as much about it as you do. Tell us about the current situation at this huge tech company and huge employer in the state.
Rogoway: Well, as you say, as recently as a year ago, Wall Street was sort of leaving Intel for dead. The stock price was languishing around $20, and everybody was writing them off, saying they don't have the latest technology, they're not able to execute, they're not delivering the chips that we expect. Things have completely reversed. The stock has been above $100 for much of the spring. The company is a Wall Street darling now. People are in love with it, and nobody, including Intel it seems, saw this coming.
Dunne: What happened? Talk about some milestones along the way between last year and now that were lifelines either to the company or created by the company.
Rogoway: One of the main things Intel had going against it was that it had been shut out of the artificial intelligence boom. AI large language models are run primarily by a class of computer chip called a GPU, a graphics processing unit, and Intel doesn't make those. They make a CPU, a more conventional chip that you'll find in your laptop or PC. So Intel had been shut out of that and wasn't getting any of the boom. The PC market was sort of languishing. What's changed is that AI systems are now doing more work. They're not just thinking. They're going out on the internet, collecting information, filling out forms and actually doing work online. It turns out the conventional CPU that Intel makes is very good at that and is in great demand. Intel is suddenly catching the AI wave, and this rising tide is lifting their boat. People are looking ahead at demand and seeing that in the years to come it could be through the roof. It used to be that buyers were purchasing several GPUs for each CPU for their AI systems, but now Intel says it's closer to one-for-one.
Dunne: If my memory is correct, didn't the federal government reach out to Intel in some way? I think the CEO of Intel met with President Trump. Take us through that.
Rogoway: The Biden administration had promised Intel billions of dollars to build new factories. Intel was expecting big demand. That demand didn't materialize. The Trump administration didn't want to honor what the Biden administration had committed to, so it was indicating it wouldn't provide any money at all. President Trump had also called for Lip-Bu Tan, the CEO of Intel, to be fired because of his investments in Chinese technology. So Lip-Bu Tan flew to the White House, met with the president, and the president made him an offer. Rather than provide money to build factories, the administration would invest directly in Intel, something like $9 billion. The company wasn't in a severe financial crisis, but it was being increasingly careful about how it spent. That investment provided some assurance that the company was in more stable shape. It also seemed to make it more important for other tech companies to start doing business with Intel. Intel, in the long run, wants to get in the business of making chips for other companies as well as making its own, and there is a sense, though nobody says it outright, that companies are warming up to hiring Intel to do this because of its relationship with the Trump administration. They feel that signing on with Intel will curry favor with the president.
Dunne: When you and I talked last time, it seemed like Lip-Bu Tan was really under pressure. You've used the phrase "Wall Street darling" for Intel now. Has his star risen as Intel's stock has risen?
Rogoway: Oh, for sure. Everybody, especially Tan himself, is crediting him with the big turnaround. He's very happy with the job he's doing and never misses an opportunity to say so. But you've got to give him credit. The company is well positioned. The last time he spoke with analysts, he said everybody needs a little bit of luck, and this is the luck that's come his way: the demand for CPUs in the AI market. I said earlier that nobody, including Intel, saw this coming, and we know this is true because Intel doesn't have the manufacturing capacity it needs to keep up with demand right now. Last quarter, their CFO said they were leaving more than a billion dollars in sales on the table because they hadn't allocated factory capacity. They just didn't see it coming. In the long run, they will catch up. The problem is that other companies are making CPUs too, and some of them don't have this capacity limitation. So Intel is losing market share right now because it can't keep up with demand, and it's hard to gain that market share back. The upside is that the demand people are seeing for Intel's products in the long run is so large that losing a few points of market share may not be that damaging. Intel will just keep rising along, as I say, with all the other boats.
Dunne: Give us a little history lesson on Intel. Have they gone through this before? This seems like a boom after what was clearly a bust not that long ago. Is that kind of normal for Intel, or has it been much more steady?
Rogoway: The whole chip industry is boom and bust. It's always cyclical, and a big part of that is because it's hard to anticipate demand. It takes time to build factories to meet demand, and by the time you get the factories built, demand may have fallen off. So you're always racing to keep ahead of the next trend. That said, this down cycle and this up cycle are unprecedented. Intel had never fallen as far as it did last year, and it had never risen as high as it is now. We should say that in both cases there may have been something of an overreaction. Intel sales were still holding up decently, fairly steady, when the stock was in the tank last year. Now that it's through the roof, sales are still steady. Everything that's exciting for Intel is in the future. Everyone's betting on the opportunity rather than what Intel is delivering now. But the market has judged that the opportunities with Intel are much greater than the company's risks at this point, and so Wall Street is happy to put their chips on Intel at the moment.
Dunne: Pardon the pun.
Rogoway: Very good.
Dunne: Are we going to see a construction boom from Intel? Do they need more data centers, more processing facilities to fulfill this promise?
Rogoway: This is an interesting question. In 2024 and 2025 combined, Intel eliminated about 6,000 Oregon jobs. They went from roughly 22,000 Oregon employees to about 16,000. So their headcount is at the lowest point it's been in well over a decade in Oregon. Part of the question is whether they're going to need more factory capacity and invest more in research. They definitely are investing more in filling out their factories in other markets, particularly in Arizona. In Oregon, Intel's specialty is research and development. This is their brain, where they develop new chip technologies. Back in the 2023-2024 timeframe, they were thinking about a significant addition to their research facility, called D1X, in Hillsboro. They shelved that when sales stalled out. They've given no indication that they plan to proceed with it in the near future. In the long run, if the company is doing well and there's demand for the technology, you would expect that some of that comes back. How long would it take to replace the 6,000 jobs that went away? It's really hard to say. It could be quite a while.
Dunne: You've used the phrase "rising tide, lifting boats." Is Intel's current success raising boats in the community in general? Are people excited about this? Does Intel doing well help local communities?
Rogoway: The people who are really benefiting right now are Intel employees, because the company pays annual bonuses and part of their compensation comes in the form of Intel stock grants and stock options. When the stock was at $20 a share, a lot of those options were worthless because they'd been granted at a higher price. People who did hold stock, it was depressed. Now I know people at Intel who, when it went from $20 up to about $58, cashed out, saying they were finally done waiting. And now they're wringing their hands because they see the stock around $110 to $120, feeling like they left so much money on the table. So yes, for Intel employees and others who own Intel stock, there's an immediate benefit, though some of it is long-term because those stock grants don't always vest immediately. For the community, the real benefit comes if Intel starts investing more in its manufacturing capacity here. All businesses have a halo effect on the communities around them, but with Intel it's especially large because it's extremely expensive to build these factories. You need lots of construction workers and lots of contractors to service them, people bringing in chemicals, doing repairs, wiring, welding. There's just an enormous ecosystem around Intel. So what we'll look for in terms of regional economic impact is that investment coming back. That's when the spillover will start to benefit the community the most.
Dunne: Mike Rogoway, longtime tech and business reporter with The Oregonian, talking about Intel and the comeback story. Mike, always appreciate talking to you. Thanks so much.
Rogoway: Yeah, thanks for having me.
Dunne: Now let's talk with one of our reporters about a new face and a potential new tax coming to town. Rebecca Hansen-White, reporter for KLCC. Always great to see you. Thanks so much for coming in.
Rebecca Hansen-White: Always great to be here.
Dunne: You've written and produced two local stories of significance. Let's break them down individually. You've been covering everything happening with Springfield Public Schools. There's a new superintendent in town. Tell us about this person.
Hansen-White: His name is John Stover, and the Springfield school board unanimously chose to hire him last week. They held a vote after a search firm found him and a couple of other finalists among 12 or 13 total candidates. The board announced who he was on Friday. He's from Rockingham County Schools in North Carolina, where he is currently superintendent. He previously worked in Washington, D.C., and Texas, and he'll start here in Springfield in July on a one-year contract.
Dunne: Just to remind folks, why did Springfield Public Schools need a new superintendent?
Hansen-White: Their longer-term superintendent, who had been here for several years, Todd Hamilton, stepped down in February. It's been a pretty tough stretch for the Springfield School District, maybe a couple of school years. In the weeks before he stepped down, the district did a mid-year layoff, which was quite unpopular.
Dunne: Why the one-year contract? Is that pretty typical, or is there any context around why they didn't go with a longer contract?
Hansen-White: To give a little context about how the superintendent job works: hiring a superintendent is one of the most important things a school board can do. The superintendent is essentially their one employee, functioning like a CEO who directs all day-to-day operations. They hired a search firm and ran a process, maybe not as long as it normally would be, because they needed someone qualified to be in place quickly. I think that to find their permanent superintendent, they want a very thorough process with a lot of opportunity for community feedback and a comprehensive search that's not done under emergency conditions. Having this person on a one-year contract will let them launch that process and then figure out whether to extend him or bring someone else in. Because it's been an emergency situation for the last six months, they haven't quite been able to do that intentional, long-term search. I think that's why the one-year contract.
Dunne: Speaking of emergencies, let's switch to your other story about the potential new tax to help fund the sheriff's office and other public safety services. What's going on there?
Hansen-White: I'll just clarify: it's not technically a new tax. To give a little background, Lane County has been in a budget crisis that's been a decade in the making. Many years ago, Oregon decided to really limit what local governments can do with property taxes, how much they can be increased, so they've really plateaued. Recently, local governments have been exploring all kinds of options to pay for services that people really expect from their government, and one of the areas where they've struggled most is public safety. There is an existing public safety tax that covers the jail, but it's not enough to support the entire system. At risk are a number of important Lane County Sheriff's deputy positions. If the county didn't act, the sheriff could lose 12 deputies, including the detective who investigates property crime and rural patrol positions. Because of that funding crisis, there is a long-term process looking into a potential new tax, but they also had to do something in the short term. And state lawmakers actually gave them a new tool this year to do it. Oregon cities and counties, especially tourism-heavy ones like ours, already collect hotel taxes. Lane County increased its hotel tax a couple of years ago, and lawmakers loosened restrictions to allow them to spend up to 50 percent of that revenue on things other than tourism promotion. Previously, those funds had to be spent mostly on tourism. I have a sound bite from the county administrator, Steve Mokrohisky, that explains why they did that.
Dunne: Let's play that clip right now.
Steve Mokrohisky: Why did the Legislature do that? Because they understand that local governments, particularly governments like Lane County that have an artificially low permanent property tax rate and cannot fund their basic services, need to have the flexibility to utilize various tools to be able to fund basic services.
Dunne: Contextualize what he just said.
Hansen-White: Lane County is struggling to pay for its basic services, and they were hoping to address the near-term problem of funding sheriff's deputies using those lodging tax revenues. It is pretty controversial, especially on the tourism industry side, because businesses have been paying into that fund expecting it to be used for tourism promotion. They've also been hoping for a new indoor sports facility that would bring in wintertime visitors, and they want that money for that. So I think that while public safety is clearly a need, the tourism industry is frustrated and feeling betrayed. If you read my story, Brian Obie, who owns the Gordon Hotel and is a major business owner in this community, was very opposed to this and felt really let down. They haven't made a decision yet. This is still a discussion. The county could also draw down its reserves, which presents its own problems. Using reserves to pay for salaries and spending them down to a very low level has created big problems for local governments as well. They're going to make a decision on all of this on June 23.
Dunne: It's going to be a complicated story, and I know you'll be on top of it. Rebecca Hansen-White, always great to talk to you. Thanks so much.
Hansen-White: Always great to be here.
Dunne: That's the show for today. All episodes of Oregon on the Record are available as a podcast at KLCC.org. Tomorrow on the show, a reporter traveled the back roads of Lane County to discover that those roads exist in a kind of no man's land where no government is responsible for repairs or maintenance, leaving residents to fill their own potholes. I'm Michael Dunne, host of Oregon on the Record. Thanks for listening.
