Intel Corporation has announced the resignation of CEO Pat Gelsinger, who stepped down on December 1, less than four years after taking the position.
His departure follows a board meeting where directors expressed concerns that Gelsinger’s ambitious turnaround strategy was not yielding the expected results quickly enough.
Sources indicate that Gelsinger was given the choice to retire or be removed and chose to resign.
Gelsinger’s exit comes well before the completion of his four-year plan aimed at reclaiming Intel’s leadership in producing the fastest and smallest computer chips, a title it lost to Taiwan Semiconductor Manufacturing Company.
Under his leadership, Intel’s market value has dwindled to less than one-third that of Nvidia, a leading competitor in artificial intelligence chips.
Since taking over in 2021, Gelsinger faced numerous challenges that he failed to address effectively. His high ambitions for manufacturing and AI capabilities led to lost contracts and unmet promises, prompting significant scrutiny from investors and industry analysts.
Just a month ago, Intel scrapped its revenue forecast due to overly optimistic projections regarding AI chip deals.
In the wake of Gelsinger’s resignation, the company has appointed Chief Financial Officer David Zinsner and senior executive Michelle Johnston Holthaus as interim co-CEOs while a search for a permanent replacement is underway.
This leadership change follows a recent $7.86 billion subsidy from U.S. officials intended to support Intel’s turnaround efforts.
The board has established a search committee to find Gelsinger’s successor. Frank Yeary, the independent chair of the board, acknowledged the progress made but emphasized the need for further work to restore investor confidence.
Gelsinger’s turnaround plan, initiated in July 2021, involved a significant investment in new factories and workforce expansion, yet coincided with a decline in the PC market post-pandemic, which severely impacted Intel’s gross margins and stock price.
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Under his leadership, Intel’s stock has plummeted over 60%.
Market analysts suggest that new leadership is essential for Intel’s recovery, with many of Gelsinger’s strategic decisions likely to be reassessed.
His attempts to position Intel as a major contract manufacturer—essentially a “foundry”—have not yet produced the volume of business necessary for profitability.As Intel navigates this transition, the company faces pressing challenges in maintaining competitiveness in the rapidly evolving chip industry, particularly in the AI sector where Nvidia has rapidly ascended.
