(Bloomberg) — Intel Corp. Chief Financial Officer Dave Zinsner said a formal separation of the company’s manufacturing and product development divisions is an open question that will be decided by the chipmaker’s next leader.
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Zinsner, who is serving as interim co-chief executive officer following the ouster of Pat Gelsinger this month, made the comments Thursday at the Barclays technology conference in San Francisco, along with co-CEO Michelle Johnston Holthaus.
Intel’s struggle to keep up with the competition – along with its deteriorating financial condition – has fueled speculation that the next CEO will make dramatic changes. This also includes the separation of the company’s manufacturing and product design activities.
“That’s an open question for another day,” Zinsner said in response to a question from analysts.
The two units are already operationally separate, with different oversight and accounts, he said. Gelsinger, who served as CEO from 2021 until last week, had insisted the two most important parts of the company could be better kept together.
Shares rose 2.1% to $20.55 at 12:36 p.m. in New York. They were down 60% through Wednesday’s close.
The executives broke with their predecessor’s more optimistic messages and emphasized that it will take time to get Intel’s competitiveness and finances in order. They pointed to advances in personal computer chips, but also advances in data center products. Another challenge is Intel’s outsourced manufacturing operations, which make chips for external customers.
Management will focus less on talking about “early indications of success” and more on concrete achievements, Zinsner said. They will also refrain from providing “meaningless” long-term forecasts of total deal value for the company’s outsourced manufacturing efforts, he added.
Johnston Holthaus said Intel needs to invest more in its products and is prepared to deal with the coming years to ensure it has offerings that will be more competitive in the long run.
Johnston Holthaus, known internally as “MJ,” also said rival Advanced Micro Devices Inc. has been more successful in providing their shared customers with the data center products they want. In 2025, the executive will focus on trying to halt the market share loss Intel has suffered, she said. As part of last week’s shake-up, Johnston Holthaus also took on the role of product CEO, putting her at the center of this effort.
In the field of accelerator chips for artificial intelligence, where Nvidia Corp. has played a dominant role, Intel has also had a hard time. The company’s Gaudi chip is difficult to use, Johnston Holthaus acknowledged. Intel is now focusing on more generic graphics chip offerings that won’t be great at first but will be updated quickly to make them competitive, she said.
(Updates with additional comments from management beginning in seventh paragraph.)
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