Intel CEO Lip-Bu Tan.Annabelle Chih—Bloomberg/Getty Images

Intel's new(ish) CEO Lip-Bu Tan dropped a bomb on the company's Q2 earnings call Thursday.

"I do not subscribe to the belief that if you build it, they will come," Tan said. 

He was referring to building factories to make chips based on the 14A process node, a next-generation chipmaking process that further shrinks the size of the transistors on a chip.  

"The increase in capital costs at 14A make it clear that we need both Intel products and a meaningful external customer to drive acceptable returns on our deployed capital," Tan said, "and I will only invest when I'm confident those returns exist."

That may sound like a sensible business practice, but if Tan were to follow through, it would represent a tectonic shift in the chip industry. It would mean that Intel—the company that gave us Moore's frickin' Law!—has quit operating as a "leading-edge" chipmaker that produces the newest, most advanced processors. 

From a historic perspective, it would mark the most stunning milestone yet in Intel's decline. From a geopolitical perspective, it would mean that Taiwan Semiconductor Manufacturing Company, or TSMC, effectively has a monopoly on leading-edge chip production. 

As a result, some observers saw in Tan's comments a bit of a gambit—a thinly veiled threat to the U.S. government to pony up financial assistance (or maybe even to help arrange commitments from "external customers") lest the U.S. forfeit its edge in advanced chipmaking. It also raises questions about Intel's commitment to its foundry business, in which it produces chips for other companies in its fabs. Whatever the true motive, the statement itself shows just how challenging Intel's comeback will be.—AO

In a memo to employees Thursday, Microsoft CEO Satya Nadella addressed an uncomfortable paradox at the heart of the $3.8 trillion company's current moment: ongoing job cuts amid record profits, bold AI investment, and a corporate culture in flux.

“By every objective measure, Microsoft is thriving—our market performance, strategic positioning, and growth all point up and to the right,” he wrote, noting the company’s capital expenditures, largely fueled by investments in AI and cloud infrastructure, are at historic highs. Despite these investments, he said headcount “is relatively unchanged,” given the simultaneous reduction of jobs.

More than 15,000 positions—about 7% of Microsoft's global workforce—have been eliminated since January, the company’s largest personnel reduction since 2014. 

Nadella called this tension the “enigma of success in an industry that has no franchise value,” arguing that success in tech is not permanent or evenly distributed. “Progress isn’t linear. It’s dynamic, sometimes dissonant, and always demanding. But it’s also a new opportunity for us to shape, lead through, and have greater impact than ever before.”—Nick Lichtenberg

Could Walmart become a leader in the burgeoning agentic AI race?

At an event in New York City Wednesday, the retail giant showed off various examples of "super agents" it said are coming soon. 

Sparky, the Walmart digital assistant that already exists and answers questions for online consumers, is being updated to take actions like creating a list of weekly essential products based on a customer’s shopping behavior and placing the order (with a thumbs-up from the customer, of course). The company also showcased internal agent use cases that the company says will allow Walmart employees to more efficiently accomplish mundane and repetitive tasks. 

Sounds great. But there's a big difference between a flashy demo and a real, live product.

Asked about the timeline, a Walmart executive seemed to sense the gist of the question and responded bluntly: “It’s not vaporware." —Jason Del Rey

Fortune recently unveiled a new ongoing series, Fortune AIQ, dedicated to navigating AI’s real-world impact. Our latest collection of stories explores how businesses across virtually every industry are putting AI to work—and how their particular field is changing as a result.

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