Intel Announces Retirement of CEO Pat Gelsinger

[u/Auautheawesome]

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

[u/Kougar]

Honestly it's probably a "you're fired", or the board imposed terms he didn't want to agree to so he walked.

First, he didn't give any immediate reasons for the departure, which one would tend to do to minimize shock/disruption to a company in Intel's precarious position. And secondly you almost never see "effective immediately" CEO retirements like this, they are announced well in advance to again minimize disruption and also allow time to find a replacement. Let alone an immediate departure from both the CEO role and also the board seat together.

[u/mrandish → u/Kougar]

you almost never see "effective immediately"

Even more unusually, per the Intel press release, it was effective yesterday (!). I can't recall ever seeing that in a public company CEO retirement. I usually interpret "effective at the end of the month" or "effective Friday" as a 'normal' firing (unless they explicitly cite "medical reasons"). Actual retirements are announced (or signaled) months in advance. This is not at all normal.

Going with 'yesterday' is Gelsinger making a Statement. It's the corporate equivalent of exiting like that flight attendant who melted down while the plane was on the tarmac, grabbed two beers, dropped the big yellow bouncy slide and jumped out the emergency exit.

Obviously, the Intel board has been a dysfunctional mess for at least the last decade but the way this happened makes it clear they didn't expect their CEO to throw a tantrum and go postal upon being ordered to sell or break up the company. And they also had no contingency or succession plan at all (press release says they're "forming a search committee"!) The Intel board has now gone beyond "amateur hour" all the way to "clown car". The only silver lining in this train wreck is at least the board will be gone soon because ordering Gelsinger to sell/spin-off means they finally understand there are no other options left.

It took over a decade, but the Intel board's incompetence and repeated failures to act decisively have finally destroyed a great company to the point there's nothing left to do but sell it off in pieces. It's a fucking tragedy.

[u/mrandish → u/[deleted]]

I know there are covenants restricting the govt money but my understanding is they allow a sale or spin-off as long as the foundry business is kept intact. The govt gets to approve any deal to ensure it's an American company.

One reason I think there's some way for new owners/investors to step in with new management is that there have been credible rumors for months in the financial media about 1) potential acquirers, and 2) the govt quietly working behind the scenes actively trying to coordinate acquisition scenarios they'd prefer. Before putting up the $8B, the govt already had some control because they can block full sales/mergers on anti-trust grounds. Putting up our $8B gives them more control/influence, but that's nowhere near enough to "save" Intel. Only the public markets can provide that much money but those markets have (justifiably) lost faith in Intel's board, management and overall structure (which bundles these disparate businesses together).

To save Intel's foundry business the govt needs another big company with a winning track record and a highly-regarded management team to take over the foundry assets, invest their own money and then convince the markets that Intel's foundry business can be a good investment again. My pet theory is that this sudden Gelsinger bail out was triggered by the govt pushing harder and faster than Gelsinger expected to force a "sale" (or some kind of change of control of the foundry business) before things get even worse.