Intel CEO Pat Gelsinger has retired, the struggling chipmaker said Monday in a surprise announcement.
Two company executives, David Zinsner and Michelle Johnston Holthaus, will act as interim co-CEOs while the company searches for a replacement for Gelsinger, who also stepped down from the company’s board.
FILE - Intel CEO Pat Gelsinger, who retired Monday Dec. 2, speaks while holding a new chip, called Gaudi 3, during an event called AI Everywhere in New York, on Dec. 14, 2023.
Seth Wenig / AP
The departure of Gelsinger, whose career spanned more than 40 years, underscores the turmoil at Intel. The company was once a dominant force in the semiconductor industry but has been eclipsed by rival Nvidia, which has cornered the market for chips that run artificial intelligence systems.
Intel is an anchor company for Oregon’s semiconductor industry and one of the state’s largest private employers with more than 20,000 workers. While the company is headquartered in Santa Clara, Calif., Intel leaders often refer to the Hillsboro campus as the heart of its development and research.
Economists following the state’s semiconductor industry predict it will add thousands of jobs in the next decade, partially because of commitments from companies like Intel to expand. Despite recent financial struggles and layoffs – including 1,300 in Washington County – Intel leaders have said they remain committed to expanding operations in Hillsboro. Last month the federal government awarded Intel $1.8 billion to upgrade its Oregon facilities.
Earlier this year, Intel picked Hillsboro as the home of a first-of-its kind tool meant to advance the development of semiconductors. The device, called a high numerical aperture extreme ultraviolet lithography scanner, is still a few years out from significantly affecting the company’s output. But it serves as an investment in making up ground lost to other chip makers that surged ahead in the AI boom.
Gelsinger started at Intel in 1979 at Intel and was its first chief technology officer. He returned to Intel as chief executive in 2021.
Gelsinger said his exit was “bittersweet as this company has been my life for the bulk of my working career,” he said in a statement. “I can look back with pride at all that we have accomplished together. 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.”
Zinsner is executive vice president and chief financial officer at Intel. Holthaus was appointed to the newly created position of CEO of Intel Products, which includes the client computing, data center and AI groups.
Frank Yeary, independent chair of Intel’s board, will become interim executive chair.
“Pat spent his formative years at Intel, then returned at a critical time for the company in 2021,” Yeary said in a statement. “As a leader, Pat helped launch and revitalize process manufacturing by investing in state-of-the-art semiconductor manufacturing, while working tirelessly to drive innovation throughout the company.”
Gelsinger’s departure comes as Intel’s financial woes have been piling up. The company posted a $16.6 billion loss and halted its dividend in the most recent quarter, and its shares have fallen by about 60% since he took over as CEO. Gelsinger announced plans in August to slash 15% of its huge workforce — or about 15,000 jobs — as part of cost-cutting efforts to to save $10 billion in 2025.
Nvidia’s ascendance, meanwhile, was cemented earlier this month when it replaced Intel on the Dow Jones Industrial Average.
Unlike some rivals, Intel manufactures chips in addition to designing them. Under Gelsinger, the company has been working to build up its foundry business making semiconductors in the U.S. designed by other firms, in a bid to compete with rivals such as market leader Taiwan Semiconductor Manufacturing Co. or TSMC.
Intel has benefited from tens of billions of dollars that the administration has pledged to support construction of U.S. chip foundries and reduce reliance on Asian suppliers, which Washington sees as a security weakness.
After taking over as CEO, Gelsinger unveiled plans to build a $20 billion chipmaking facility in central Ohio, and poured billions more into expanding in Europe, where leaders were also worried about dependence on Asia.
The Biden administration had said it would give Intel up to $8.5 billion in federal funding for semiconductor plants around the country. Last week the U.S. Department of Commerce trimmed that amount to around $8 billion.
Shares of the Santa Clara, California, company, rose 5.1% in morning trading.
_____
OPB’s Kyra Buckley contributed reporting. AP Business Writer Kelvin Chan contributed to this report from London.
