Intel CEO Pat Gelsinger retires, company appoints interim Co-CEOs
Intel CEO Pat Gelsinger has announced his retirement, which will take effect on December 1, 2024. Gelsinger has stood down as CEO and resigned from the company's board of directors.Following his retirement, Intel executives David Zinsner, Chief Financial Officer, and Michelle Johnston Holthaus, General Manager of the Client Computing Group, were appointed as interim co-CEOs.
Holthaus will also take on the newly created post of CEO of Intel Products, a division that includes both consumer and enterprise-focused sectors such as data centre, AI, network, and edge businesses.
Frank Yeary, the independent chair of Intel's board, will serve as interim executive chair during the leadership transition. Intel has stated that the leadership at Intel Foundry, the company's chip design and production division, will remain unaltered. Additionally, the board has launched a search committee to find Gelsinger's permanent successor.
Gelsinger, who joined Intel as an 18-year-old in 1979, expressed gratitude for his experience at the corporation. "Leading Intel has been an honour of a lifetime. This company has been my life's work for the majority of my career, and I am pleased of what we've accomplished together," Gelsinger said in a statement. "It has been a challenging year, but necessary decisions were made to position Intel for the future."
According to Bloomberg, Intel's board offered Gelsinger with the option of retiring or being dismissed from his post.
Gelsinger's time at Intel began in 2021, when he returned as CEO amidst rising pressure from activist investors. His return signalled the start of an ambitious five-year strategy to re-establish Intel as a chip manufacturing leader, with a special emphasis on catching up with competitors such as Taiwan's TSMC and Samsung.
Under Gelsinger's leadership, Intel committed to establishing multibillion-dollar chip production operations in the United States and abroad, with the US government giving assistance under the CHIPS Act. However, his tenure at the helm was not without challenges.
Despite Gelsinger's efforts to alter Intel's product portfolio, such as promoting Intel's AI chips to compete with Nvidia's, the business faced significant technical and market obstacles. A decline in PC chip sales, the loss of clients like as Sony and Waymo, and the failed acquisition of Israeli business Tower Semiconductor in 2023 were some of the challenges he encountered during his tenure.
Intel also had serious challenges with their 18A manufacturing process, which failed to fulfil expectations, prompting businesses like as Apple and Qualcomm to bypass Intel. In addition, Intel's aim to become a contract maker for other companies encountered technological difficulties.
The company's revenue fell drastically, reaching $54 billion in 2023, a 33% decrease from the year Gelsinger took CEO. Intel has since revealed plans to eliminate over 15,000 positions and restructure as part of a $10 billion cost-cutting program.
Despite the hurdles, Intel is making progress under its new leadership. Following Gelsinger's departure, Intel shares climbed by about 2.66%, showing market optimism.
"We will continue to focus on simplifying and strengthening our product portfolio, advancing manufacturing and foundry capabilities, and optimising our operating expenses," Yeary told the media in a statement. "Our goal is to create a leaner, simpler, and more agile Intel."
Intel's efforts to turn around its woes include spinning off its foundry business and obtaining new customer victories, like as agreements with Amazon Web Services and the Pentagon. However, with persistent issues in its primary industry and the impending need for a permanent CEO, the company's future is questionable.
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