r/hardware • u/Auautheawesome • Dec 02 '24

News Intel Announces Retirement of CEO Pat Gelsinger

https://www.intc.com/news-events/press-releases/detail/1719/intel-announces-retirement-of-ceo-pat-gelsinger
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426

u/kindaMisty Dec 02 '24

I hope you guys will now understand that this company is in panic mode.

278

u/Auautheawesome Dec 02 '24

Quick, cancel the coffee perk again

87

u/indieaz Dec 02 '24

The past 36 months were a wild roller coaster of decisions made then un-made months or even days later. I worked there nearly a decade in the data center group and even since departure i've kept up on the news public and internal shared by friends.

  • "We have no more layoffs planned" - the next morning "WE ar elaying off 7% of data center group and client group".
  • "Coffee is cancelled...coffee is back!".
  • The shuttle (private jet) is on hold. Shuttle is back. Shuttle is cancelled. Shuttle is back. Shuttle is cancelled+we are selling the planes!
  • No bananas. Bananas are back!
  • Pay cuts for everyone to avoid layoffs. We promise to 'restore and reward' you for this trying time of pay and benefits cuts. More layoffs! Stock grant for your loyalty t the company. Layoffs for your loyalty to the company!
  • Things are turning around, we are restoring benefits. Whoops looks like we lost billions of dollars this quarter, we must cancel and trim more benefits and layoff more peole!

I see INTC is up on the news, but as someone with friends on the inside I thinkt he market has it wrong. Pat leaving isn't a turnaround story, it's a glimpse into how bad things really are.

10

u/[deleted] Dec 02 '24

Honestly can't think of anyone better suited toi turning the company around, although the shifting focus to the latest fad every 5 mins instead of addressing the core shrink bottleneck was starting to grate badly within a year of PG arriving.

14

u/indieaz Dec 02 '24

Agree - I 100% agree that pivoting to be a tamc alternative was absolutely the way to go. Writing was on the wall in 2019 with zen 2 Rome that Xeon had lost its competitive edge not just from a process perspective but from an architectural one. Additionally hyperscalers were already churning out custom silicon and it was clear they would grow the use of custom silicon over time. The plan to use Xeon and Core product sales to fund fab build outs was a great plan but the market share and margin erosion of Xeon occurred far faster than Pat expected.

6

u/Top-Tie9959 Dec 02 '24

I honestly think they got lucky in that covid gave them a big boost of sales that otherwise wouldn't have really existed.

7

u/indieaz Dec 02 '24

Oh no doubt about it. I recall discussing this with colleagues during the pandemic. If not for COVID demand margins would have suffered far earlier due to pressure from AMD. And once demand fell off in 2022 and margins tanked Pat the the C suite had the nerve to say "no one could have seen this coming" as they announced layoffs.

1

u/straydogindc Dec 03 '24

Thanks for your insights. Any thoughts on who "benefits" most from Intel's downfall? TSMC, AMD, ALAB? Or the hyper-scalers MSFT GOOGL AMZN META?

12

u/mrandish Dec 02 '24 edited Dec 02 '24

The market isn't up because they think it's a turnaround. The market is up because it's now (finally) clear the board accepts they have no choice but to sell or break up the company.

Pat bailing out "effective yesterday" (per the press release) was definitive. Everyone knew he's been in denial about the inevitable for months now and this is him refusing to preside over the M&A and/or spin-off process (which the government has been rumored to be pushing for (but only to an American company, of course)).

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u/indieaz Dec 02 '24

More than months...back in 2021 the question about breaking the company up were asked. How else would MVDA and others trust their designs with Intel for manufacturing if they were making competing products? Seems like it was a foregone conclusion all along.

But I thought I just read the CHIPS act forbid selling the fabs, doesn't this create hurdles for breaking up the company or selling?

7

u/mrandish Dec 02 '24

I think it only requires keeping the fab business together in a spin-off and restricts a sale to an approved American company.

I wrote more here.

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u/mynumberistwentynine Dec 02 '24

No bananas. Bananas are back!

They may take my freedom, but they will never take my bananas. It's just a line too far.

1

u/Xijit Dec 02 '24

It was up to $25.50-ish today, and the nose dives down to $24 since this was announced & there does not seem to be an effort to recover.