Shares of Intel (NASDAQ: INTC) continued to retreat today after an initial pop following the departure of CEO Pat Gelsinger. Intel added new members to its board of directors this morning, but a picture is also emerging of a chaotic search for a new CEO.
As a result, the stock fell 4.3% as of 11:15 a.m. ET.
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It’s rare for a company to send a CEO home without a replacement ready or a clear strategy for finding one, but it appears Intel has done just that.
Since the board pushed Gelsinger into retirement, the company has reportedly reached out to everyone Marvell CEO Matt Murphy to former Cadence Design Systems CEO and former Intel board member Lip-Bu Tan, as well as several executives from Taiwanese semiconductor manufacturing.
Intel also presented at an investor conference and faced a number of questions from puzzled analysts about the CEO situation, and investors seem unhappy with the answers. While the stock underperformed under Gelsinger’s tenure, he also seemed to have an ideal resume for the job as the company’s former chief technology officer and CEO of VMware for several years.
The timing is also strange, as Gelsinger had just announced a large-scale restructuring in August and Intel’s foundry is about to roll out its 18A (18 angstroms) process, meaning the decision seems highly disruptive to the company’s priorities company in the short term.
Intel also called former ASML CEO Eric Meurice and Steve Sanghi, the interim CEO of Microchip technology as members of the board of directors.
It’s unclear how long the CEO search will last, but the longer it goes, the worse it will likely be for the stock and the company. The foundry strategy now also appears to be in limbo, as Gelsinger was likely ousted due to the challenges at the foundry division.
The company reaffirmed its expectations at the investor conference, but the chip stock could easily fall if questions about the gap in its leadership persist.
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