Intel (INTC) is in a race against time to find a new chief executive officer who can launch the company into the artificial intelligence era. Otherwise, you risk falling into a state of worthlessness.
A series of strategic missteps and failures to build cutting-edge technology dating back to the early 2000s culminated in the once-dominant chipmaker’s dramatic collapse in 2024, with its stock plummeting 55%.
The board fired CEO Pat Gelsinger in December and appointed two interim co-CEOs.
The move exposed the board’s lack of a coherent strategy and doomed Gelsinger’s bold turnaround plan to open up Intel’s manufacturing operations (i.e., run foundries) to make chips for external customers. posed a question.
“I think it was the board that should have been fired, not him,” William Lazonick, an analyst at the Institute for New Economic Thinking who has written extensively about Intel, told Yahoo Finance.
Since Gelsinger’s departure, the company’s board has added two semiconductor experts to its board: former ASML CEO Eric Meurice and Microchip Chairman Steve Sanghi. Prior to their addition, only two of the 11 board members had experience in the semiconductor industry, according to Citi analyst Christopher Danley.
A Wall Street Intel analyst said Meurice and Sanghi were “already…challenging planning (and) processes within Intel.” They requested anonymity because they were not authorized to speak publicly on the subject.
Intel declined to comment on its CEO search.
Yahoo Finance spoke with analysts and several former senior Intel executives to provide insight into who Intel’s board will choose to take the helm of America’s only large-scale cutting-edge chipmaker.
The aforementioned Intel analyst told Yahoo Finance that interim co-CEO David Zinsner “doesn’t want the job.” Mr. Zinsner’s co-star, Michelle Johnston Holthaus, is being considered for the role, people familiar with the matter said. A former executive said the veteran leading Intel’s product group “has an opportunity.”
A former Intel manufacturing executive and another former senior executive have criticized Holthaus for lacking technical skills, which analysts and Intel insiders say are essential in the next leader. I agree that it is.
“She’s never an independent thinker. She’s never going to push an agenda,” said one former executive. Inter describes Holthaus as a “proven general manager and leader.”
Anshel Sugg, an analyst at Moore Insights & Strategy, said the chipmaker would likely choose someone who is currently outside the company, but the decision would take time.
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“As someone who has very strong connections within the company, I don’t feel like they’re even remotely close to picking someone,” Sugg told Yahoo Finance.
Bloomberg cited unnamed sources as saying Intel’s external candidates include former Cadence Design Systems (CDNS) CEO Lip Vu Tan, Marvell Technology (MRVL) CEO Matt Murphy and Intel board member The list includes Stacey Smith, Ampere Computing founder Lennie James, and Apple (AAPL). Internal chip head Johny Srouji, Analog Devices (ADI) executive Gregory Bryant, and Lenovo (0992.HK) Kirk Skaugen.
Five of these “outsiders” previously worked for Intel. Some of them spent more than a decade with the company before being forced out under former CEO Brian Krzanich.
Intel analysts also named Boeing (BA) chairman and former Qualcomm (QCOM) CEO Steve Mollenkopf and Eclipse Ventures general partner Sanjay Jha as potential candidates. .
Sources have mixed opinions on whether Intel should hire an insider who knows the company well.
“Intel needs to be looked at with new eyes, beyond its old affiliations,” Futurum Group analyst David Nicholson told Yahoo Finance.
Stacey Rasgon, a semiconductor analyst at Bernstein, said Lip Vu Tan is a candidate that “many shareholders would like to see play the role.” Mr. Tan previously served on Intel’s board, but resigned in August because he disagreed with Intel’s foundry strategy, a plan that Mr. Gelsinger actively promoted. Former executives agreed that Mr Tan was “well-respected” and in many ways the ideal person for the role.
“Lip-Bu knows how to pivot, how to reinvent a business, how to drive change. He also knows how resistant Intel is to change,” said Intel’s a manufacturing executive told Yahoo Finance.
But analysts said Tan would not be interested in such a leadership role at this point in his career. Mr. Tan also serves on the board of Mr. Gelsinger’s Christian organization.
A former senior executive familiar with the matter said the company was still deciding whether to consider Tan for the role.
One of the five former Intel insiders reportedly being considered for the CEO position is Lennie James, founder of AI startup Ampere, with two former executives calling him a “strategic “Excellent in terms of performance” and “execution-oriented.”
But one person who has worked at the company for decades said Mr. James’ relationship with the board was not good enough to warrant a top pick.
Stacey Smith, a member of Intel’s board of directors who worked for the company for nearly 30 years, including nearly 10 years as CFO, said the former Intel manufacturing executive is “trusted, respected and well-liked.” I commented.
Mr. Smith recently oversaw the IPO of Japanese company Toshiba’s chip business (renamed Kioxia) as chairman of the board. The completion of Kioxia’s IPO cleared the way for Mr. Smith to take the Intel job, one former executive said.
Former executives also praised Kirk Skaugen, a former engineer who held executive roles across Intel’s PC and data center businesses. Apple’s Srouji and Marvell’s Murphy both have expertise in semiconductors, but sources doubt who will take the top spot.
Intel has hired executive search firm Spencer Stewart to assist in the search, Bloomberg reports.
Wall Street has mixed views on how long it will take to find a CEO. “We are relatively advanced in the process,” Danley wrote in a Jan. 8 note to clients, suggesting the process could be completed “within the next few months.” Meanwhile, KeyBanc’s John Vinh wrote in his note on the same day that the process would likely take four to six months.
“The board is currently considering external candidates without setting a firm timeline,” Bin said.
Intel stock soared last Friday after reports that an unnamed company was looking to acquire the company. Citi writes that Broadcom (AVGO) is the most likely buyer, while analyst Dylan Patel suggests Elon Musk. Last year, Qualcomm was reported to have considered an acquisition, but interest in such a deal has waned.
Intel did not respond to requests for comment on the acquisition rumors.
Meanwhile, U.S. authorities are keeping an eye on the merger between U.S.-based chipmaker GlobalFoundries and Intel, according to Bloomberg.
But until a new CEO is found, the semiconductor giant is stuck. Bin, the KeyBanc analyst, added in the note that “interim CEOs…will avoid irreversibly altering the overall grand strategy.”
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Yasmin Khorram is a senior reporter at Yahoo Finance. Follow Yasmin on Twitter/X @YasminKhorram and LinkedIn. Send newsworthy tips to Yasmin: yasmin.khorram@yahooinc.com
Laura Bratton is a reporter for Yahoo Finance. Follow her at Bluesky @laurabratton.bsky.social. Email laura.bratton@yahooinc.com
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Adnan is a passionate doctor from Pakistan with a keen interest in exploring the world of politics, sports, and international affairs. As an avid reader and lifelong learner, he is deeply committed to sharing insights, perspectives, and thought-provoking ideas. His journey combines a love for knowledge with an analytical approach to current events, aiming to inspire meaningful conversations and broaden understanding across a wide range of topics.
