Technology
Intel CEO Pat Gelsinger Ousted: Inside the Leadership Shake-Up at the Chip Giant
Intel (INTC) announced Monday that CEO Pat Gelsinger has retired, effective Dec. 1, and has also resigned from the company’s board of directors. Gelsinger had led aggressive efforts to revive the U.S. chipmaker for more than three years.
Stock market volatility
Following the news, Intel’s stock rose nearly 5% by midday but later declined due to the veteran’s damaging comments. Shares fell as much as 2.5% in afternoon trading and ended the day down half a percentage point.
Change in leadership needed
According to Yahoo Finance, a person familiar with the matter said the board had lost confidence in Gelsinger and a change was needed before 2025. The decision was made by a small group inside Intel, and the leadership team was informed only on Sunday afternoon. It is not yet clear whether Intel will continue Gelsinger’s expensive expansion to make chips for other companies.
Appointment of interim CEO
Intel has appointed CFO David Zinsser and former client computing chief Michelle Johnston Holthaus as interim co-CEOs. Holthaus has also been appointed as CEO of Intel Products. The company said its board has formed a search committee and “will work swiftly and exhaustively to find a permanent successor to Gelsinger.”
Progress and challenges
“While we have made significant progress in regaining manufacturing competitiveness and building world-class foundry capabilities, we know there is still much work to do at the company, and we are committed to restoring investor confidence,” Intel board chair Frank Yeri said in a statement.
Legal issues
Intel is facing two separate lawsuits this year that accuse investors of misrepresenting the company’s financial performance. The most recent case was filed by a pension fund in August, when the chipmaker announced 15,000 job cuts.
Gelsinger’s Career
Gelsinger previously spent 30 years at Intel but left the company in 2009. He rejoined the company in 2021, where he took over as chief executive from Bob Swan. Gelsinger promised that his tenure would bring back the “Grovian” mindset at the company and attempt to correct years of mistakes that saw Intel lose its edge in the chip market.
Conclusion
After Gelsinger’s resignation, Intel is now moving to a new chapter. The company will now have to face its challenges under new leadership and redefine strategies to maintain its competitiveness. Investors and employees now expect the company to emerge stronger under its new leadership.
FAQs
Q. Why did Pat Gelsinger resign as CEO of Intel?
A. Pat Gelsinger retired as CEO of Intel effective December 1, following a loss of confidence from the board regarding his leadership.The decision was made by a small group within Intel, indicating a need for change before 2025.
Q. Who will lead Intel after Gelsinger’s resignation?
A. After Pat Gelsinger’s departure, Intel appointed CFO David Zinsser and former client computing chief Michelle Johnston Holthaus as interim co-CEOs. Holthaus has also taken on the role of CEO of Intel Products.
Q. What impact did Gelsinger’s resignation have on Intel’s stock?
A. Following the announcement of Gelsinger’s resignation, Intel’s stock rose nearly 5% initially but later declined due to negative comments associated with his leadership. Ultimately, shares ended the day down half a percentage point.
Q. What challenges is Intel facing after Gelsinger’s departure?
A. Intel is currently facing challenges such as restoring investor confidence, navigating ongoing legal issues from lawsuits regarding the company’s financial performance, and determining the future of its expansion plans in chip production.
Q. What is the future for Intel under new leadership?
A. Intel is entering a new chapter under interim leadership, with a commitment to addressing ongoing challenges and redefining strategies to enhance its competitiveness in the semiconductor market. The board has formed a search committee to find a permanent successor to Gelsinger.
