Intel's Leadership Shakeup: Seeking a New Direction

Intel CEO Pat Gelsinger resigns amid unsuccessful turnaround efforts, shifting leadership to interim co-chief executives David Zinsner and Michelle Johnston Holthaus as Intel faces declining market value and competition from Nvidia. The company is also seeking a permanent CEO while managing investor confidence and strategic adjustments.

In a significant shift for Intel, Chief Executive Pat Gelsinger has stepped down less than four years after taking the role. His departure comes as the company grapples with a declining market position and heightened competition, notably from Nvidia. Gelsinger's ambitious turnaround strategy, unveiled in July 2021, has not delivered the anticipated quick results, despite substantial investments in new manufacturing facilities and workforce expansion.

The leadership transition places interim co-chief executives, David Zinsner and Michelle Johnston Holthaus, at the helm while a search committee, formed by the board of directors, seeks a permanent CEO. This move follows the U.S. government's aid of $7.86 billion to support Intel's strategic realignment. The company's stock experienced a modest rise after Gelsinger's resignation, yet Intel's valuation remains significantly lower than that of its competitors.

Intel's board, led by independent chair Frank Yeary, remains committed to regaining manufacturing competitiveness and boosting investor confidence. However, Gelsinger's tenure saw the company struggle with operational setbacks, including a costly expansion plan that coincided with a shrinking market for laptops and PCs. The board's choice signals a decisive step towards steering the company on a new path while addressing challenges in the AI chip market and evolving manufacturing strategies.

(With inputs from agencies.)