Intel announced on Monday its Chief Executive Pat Gelsinger stepped down less than four years after taking the helm of the company, handing control to two lieutenants as the faltering American chipmaking icon searches for a permanent replacement.
Gelsinger, who resigned on Dec. 1, left the company before the completion of an ambitious and costly four-year plan to restore the company's lead in making the fastest and smallest computer chips, a crown it lost to Taiwan Semiconductor Manufacturing Co (TSMC), which makes chips for Intel rivals such as Nvidia.
Gelsinger is retiring after a career spanning more than 40 years. He also stepped down from the company's board. He started at Intel in 1979 at Intel and was its first chief technology officer. He returned to Intel as chief executive in 2021.
While Gelsinger has assured both investors and U.S. officials, who are subsidizing Intel's turnaround, that his manufacturing plans remain on track, the full results will not be known until next year, when the company aims to bring a flagship laptop chip back into its own factories.
"While we have made significant progress in regaining manufacturing competitiveness and building the capabilities to be a world-class foundry, we know that we have much more work to do at the company and are committed to restoring investor confidence," Frank Yeary, independent chair of the board, said in a release.
Shares of the company rose nearly 5% in premarket trading. The stock has lost more than half of its value this year, and was replaced last month by Nvidia on the blue-chip Dow Jones Industrial Average index.
The company named Chief Financial Officer David Zinsner and senior executive Michelle Johnston Holthaus as interim co-chief executive officers while its board conducted a search for a new CEO.
Zinsner is also executive vice president. Holthaus was appointed to the newly created position of CEO of Intel Products, which includes the client computing group, data center and AI group and network and Edge Group.
The company's board has formed a search committee to appoint Gelsinger's successor.
Last week, it was revealed that the Biden administration plans on reducing part of Intel’s $8.5 billion in federal funding for computer chip plants around the country, according to three people familiar with the grant who spoke on the condition of anonymity to discuss private conversations.
The reduction is largely a byproduct of the $3 billion that Intel is also receiving to provide computer chips to the military. President Joe Biden announced the agreement to provide Intel with up to $8.5 billion in direct funding and $11 billion in loans in March.
The changes to Intel’s funding are not related to the company’s financial record or milestones, the people familiar with the grant told The Associated Press (AP). In August, the chipmaker announced that it would cut 15% of its workforce – about 15,000 jobs – in an attempt to turn its business around to compete with more successful rivals like Nvidia and AMD.
Unlike some of its rivals, Intel manufactures chips in addition to designing them.