(Bloomberg) — Intel Corp. CEO Pat Gelsinger, who was hired in 2021 to lead an ambitious turnaround of the iconic chipmaker, will leave his job after the comeback sputtered and the company fell further behind rivals.
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Intel Chief Financial Officer David Zinsner and Michelle Johnston Holthaus will serve as interim co-CEOs while the board searches for Gelsinger’s replacement, the company said in a statement. Frank Yeary, independent chairman of Intel’s board of directors, will serve as interim chairman.
Gelsinger, 63, was hailed as the savior of the chip pioneer, expressing his love for the company and his determination to return it to prominence in the semiconductor industry it defined. The executive started working at Intel when he was a teenager, but left in 2009 to become CEO of VMware Inc. Upon his return to Intel, he vowed to regain the chipmaker’s leading position in manufacturing — something the company had lost to rivals such as Taiwan Semiconductor Manufacturing Co.
Shares of Intel rose more than 3% in early trading in New York on Monday following the announcement. This year they are still down more than 50%.
Gelsinger wanted to take Intel beyond its traditional strength in personal computer and server processors by expanding into making chips for other companies – something it had never done before and putting it in direct competition with TSMC and Samsung Electronics Co. Gelsinger explained a costly plan to expand Intel’s factory network. That included building a massive new complex in Ohio, a project for which the company received federal support from the Chips and Science Act.
The director said last month that he had “a lot of energy and passion,” still had the support of the board and was making progress. He expressed his determination to keep the company together despite reports that takeover bids had been made, and said he was making progress with his plans. Intel’s board held a meeting last week.
“Today is of course bittersweet, as this company has been my life for most of my career,” Gelsinger said in the statement. “It has been a challenging year for all of us as we made difficult but necessary decisions to position Intel for today’s market dynamics.”
One of the biggest challenges Intel faced was the industry shake-up in artificial intelligence. Nvidia Corp., which has made its graphics chips a key component for data centers, dominates that area and has raised tens of billions of dollars that once would have gone to Intel’s data center division. The former niche rival that struggled in Intel’s shadow has made itself the most valuable publicly traded company in the world, and Intel’s efforts to penetrate that market with new products have yet to take off.
