Intel Corporation announced Monday that CEO Pat Gelsinger has resigned, marking the end of a challenging tenure for the executive tasked with revitalizing the once-dominant chipmaker.
Gelsinger, who returned to Intel in 2021 after leading VMware, faced formidable obstacles, including intense competition, production setbacks, and the company’s failure to capitalize on the artificial intelligence (AI) boom.
During Gelsinger’s time as CEO, Intel’s stock plummeted by 61 per cent, reflecting the company’s diminishing market position. While Intel had long been a leader in chip manufacturing, it lagged in adapting to transformative shifts in the tech landscape, from mobile computing to AI.
Despite substantial U.S. government investments, including funding under the CHIPS Act, Intel struggled to regain its footing, even as rivals like Nvidia capitalized on the AI revolution. Nvidia, once a minor competitor, now boasts a market value of $3.4 trillion—33 times Intel’s $104 billion.
In August, Intel announced plans to cut 15 per cent of its workforce, targeting $10 billion in cost reductions to streamline operations. Gelsinger described these efforts as part of a broader strategy to fundamentally restructure the company. However, the results were insufficient to restore investor confidence.
Intel’s board has appointed David Zinsner, CFO, and Michelle (MJ) Johnston Holthaus, general manager of the client computing group, as interim co-CEOs. Holthaus will also serve as CEO of Intel Products, overseeing the company’s critical data center and AI initiatives.
Board Chair Frank Yeary, now interim executive chair, emphasized Intel’s commitment to simplifying its product portfolio, enhancing manufacturing capabilities, and pursuing a leaner operational model.
The company faces significant challenges as it transitions toward manufacturing processors for competitors like Apple, aiming to compete with chipmaking giants such as TSMC. This shift aligns with U.S. policy efforts to bolster domestic chip production but has been marred by delays.
Intel recently announced a reduction in its CHIPS Act grant from $8.5 billion to $7.86 billion due to postponed investments in new manufacturing facilities. Despite these setbacks, the company remains focused on its strategic priorities under its new leadership, seeking to regain its competitive edge in the rapidly evolving semiconductor industry.
