Intel Corporation has announced the resignation of CEO Pat Gelsinger, effective December 1, less than four years into his tenure. His departure follows concerns raised by the board of directors over the slow progress of his ambitious turnaround strategy.
According to sources, Gelsinger was offered the option to retire or face removal and chose to step down. His resignation comes before the completion of a four-year plan aimed at restoring Intel’s dominance in producing advanced computer chips, a position now held by Taiwan Semiconductor Manufacturing Company (TSMC).
During Gelsinger’s leadership, Intel’s market value fell to less than one-third of Nvidia’s, a major competitor in artificial intelligence (AI) chips. His tenure was marked by significant challenges, including lost contracts and unfulfilled promises in manufacturing and AI development, leading to growing skepticism among investors and industry analysts.
Just weeks before his resignation, Intel abandoned its revenue forecast, citing overly optimistic projections regarding AI chip deals. The company also faced declining gross margins and stock prices, exacerbated by a post-pandemic slump in the PC market.
To fill the leadership gap, Intel has appointed Chief Financial Officer David Zinsner and senior executive Michelle Johnston Holthaus as interim co-CEOs while a search for Gelsinger’s permanent replacement is underway. The board has formed a search committee to identify a successor, with Independent Chair Frank Yeary acknowledging Gelsinger’s efforts but emphasizing the need for stronger performance to regain investor confidence.
Gelsinger’s turnaround strategy, launched in mid-2021, included substantial investments in new factories and workforce expansion. However, these efforts coincided with Intel’s struggle to compete in the AI and contract manufacturing markets, where rivals like Nvidia and TSMC have surged ahead. Despite securing a $7.86 billion U.S. government subsidy to support its initiatives, Intel’s stock has plummeted by more than 60% under Gelsinger’s watch.
Market analysts suggest that fresh leadership is crucial for Intel’s recovery, with many of Gelsinger’s decisions expected to be reevaluated. The company now faces critical challenges in regaining competitiveness in the fast-evolving chip industry, particularly in the AI sector, where Nvidia has emerged as a dominant force.
