Intel announced Monday that chief executive officer Pat Gelsinger is retiring from the company and has stepped down from its board of directors.
The move comes as the chipmaker struggles to keep pace with massive competitors like Nvidia amid the artificial intelligence boom. In recent months, Intel has also been the subject of activist investor interest — including a potential takeover bid — as its performance continues to lag.
As the board searches for a new chief, the Santa Clara, California-based tech giant named David Zinsner and Michelle Johnston Holthaus as co-CEOs. Frank Yeary, the independent chair of Intel’s board and its interim executive chair, said the pair will continue the company’s mission to simplify and strengthen Intel’s product portfolio and advance manufacturing and foundry capabilities while cuttin g costs.
“While we have made significant progress in regaining manufacturing competitiveness and building the capabilities to be a world-class foundry, we know that we have much more work to do at the company and are committed to restoring investor confidence,” Yeary said in a statement.
“We are working to create a leaner, simpler, more agile Intel,” Yeary said.
Intel stock was up about 4% in pre-market trading on Monday. The company’s shares have shed roughly 50% of their value so far this year.
Gelsinger returned to Intel as CEO in 2021, replacing Bob Swan, to help modernize — and stabilize — the company, to little avail.
“It has been a challenging year for all of us as we have made tough but necessary decisions to position Intel for the current market dynamics,” Gelsinger said in a statement Monday.
The company has taken several measures to kickstart its sputtering performance. In August, Intel announced a plan to save $10 billion in 2025. That included reducing its headcount by roughly 15,000, or 15% of its workforce. Gelsinger said at the time that these were the “most consequential changes” in the company’s history.
As part of the restructuring plan, Intel took a $2.8 billion charge in the third quarter. The company saw a 6% year-over-year decline in revenues in the three months ended Sept. 28, for a net loss of $16.99 billion, or $3.88 per share.
Intel also reportedly hired Morgan Stanley and other advisors to help fend off potential activist investors, according to CNBC.
Early last month, Intel was removed from the Dow Jones Industrial Average, which comprises 30 leading U.S. stocks, to make room for Nvidia as the index shifts toward AI pioneers.
Source: https://qz.com
