Difficulties in AI transformation, performance losses, and a market value shrinkage of nearly half, Intel CEO "forced" to retire, with stock prices once rising over 5.7%

On December 2nd, Eastern Time, Intel Corporation announced that Chief Executive Officer Pat Gelsinger retired on December 1st and has resigned from the board of directors.

Gelsinger began his career at Intel in 1979 and has been with the company for over 40 years. He took over as CEO of Intel on February 15, 2021. During his nearly four-year tenure, Intel set ambitious plans, but its market position continued to decline.

According to financial reports, Intel's revenue in 2021 was $74.7 billion, a year-on-year increase of 2%. However, revenue dropped to $57 billion in 2022 and $47.7 billion in 2023. In November 2024, Intel reported a quarterly loss of $16.6 billion, the largest loss in the company's history. Analysts pointed out that the losses were due to Gelsinger's bold transformation strategy failing to achieve results.

After the announcement, Intel's stock price rose more than 5.7% in early trading on Monday, but it has still fallen about 50% year-to-date.

Gelsinger Forced to Leave

The 63-year-old Gelsinger was once hailed as the "savior" of the chip giant. He expressed his love for the company and was determined to help Intel revitalize its foundry business and reclaim its position as the "leader" in chip manufacturing. Industry analysts had high hopes for Gelsinger's return, as he was a former engineer at Intel and the company's first Chief Technology Officer.

However, Gelsinger faced some structural issues that were too large to overcome quickly. Even with strong government support and Gelsinger's ambitious expansion plans, Intel struggled to escape the competitive pressure from NVIDIA and AMD.

Gelsinger also strongly promoted Intel's relationship with the U.S. government, successfully securing a contract to produce secure chips for the Department of Defense. However, as Intel's spending became increasingly aggressive, investor enthusiasm began to wane. The AI revolution propelled the growth of other semiconductor companies, while Intel's efforts to capture market share in AI proved ineffective, leading to more investor skepticism, and the company's market value has lost nearly 50% this year.

According to Bloomberg, Gelsinger was forced to leave after the board lost confidence in his plans to turn Intel around, bringing more turmoil to the company.

Sources revealed that the conflict reached a climax last week when Gelsinger discussed the company's progress in reclaiming market share and narrowing the gap with NVIDIA with the board. The board gave him an ultimatum: retire or be dismissed, and Gelsinger chose to announce the end of his career at Intel

Intel Leadership Changes

Intel has made changes to its management team, appointing two senior leaders, David Zinsner and Michelle Johnston Holthaus, as interim co-CEOs, while the board is searching for a new CEO. Independent board chairman Frank Yeary will serve as interim executive chairman during the transition.

Additionally, Zinsner will serve as executive vice president and chief financial officer, while Holthaus has been appointed to the newly established position of "CEO of Intel Products," responsible for the Intel Products division, which includes the company's Client Computing Group (CCG), Data Center and Artificial Intelligence Group (DCAI), and Network and Edge Group (NEX). The leadership structure of Intel's foundry remains unchanged.

Zinsner and Holthaus stated:

"We are grateful for Pat's dedication and leadership over the years at Intel. We will double down on Intel products and meet customer needs. As we continue to enhance our product and process leadership, we will focus on driving returns on foundry investments."

Zinsner has over 25 years of financial and operational experience in the semiconductor, manufacturing, and technology industries. He joined Intel in January 2022 from Micron Technology, where he served as executive vice president and chief financial officer. Early in his career, Zinsner held various other leadership positions, including president and chief operating officer of Affirmed Networks and senior vice president of finance and chief financial officer at ADI.

Holthaus is an experienced general manager and leader who began her career at Intel nearly thirty years ago. Prior to her appointment as CEO of Intel Products, she served as executive vice president and general manager of CCG. Holthaus has held various management and leadership roles at Intel, including chief revenue officer and general manager of the Sales and Marketing Group, as well as global head of sales for CCG