Intel announces sudden departure of CEO amid financial turmoil

By Jacob Roach Published December 2, 2024

Intel has announced that CEO Pat Gelsinger has retired. The executive, who first joined Intel in 1979 at 18 years old, is being replaced by David Zinsner and Michelle Johnston Holthaus. Holthaus and Zinsner will serve as interim co-CEOs while the board of directors works “diligently and expeditiously” to find a successor.

Gelsinger became CEO in early 2021. At the time, Intel was struggling to regain ground it had lost to AMD in the desktop market, as well as push a more ambitious manufacturing timeline to catch up with foreign chipmakers like TSMC. Under Gelsinger’s leadership, the company made some big strides. Intel’s 12th generation of processors marked a significant turning point in the company’s desktop processors, and an aggressive foundry roadmap has pushed smaller nodes out of U.S.-based plants.

Still, Intel is in bad shape financially. Despite the aggressive timeline, the company has outsourced its most recent designs to TSMC with Lunar Lake and Arrow Lake CPUs. And as you can read in our Core Ultra 9 285K review, even those chips struggle to hold up.

This wasn’t just a one-off generation, either. Although Gelsinger’s plans changed the direction of the company, it seems Intel wasn’t able to turn the corner fast enough. In its most recent earnings report, the company reported losses of $16.6 billion. This comes in the face of record revenue from Nvidia and AMD, who have made significant inroads in AI hardware.

As if that weren’t enough, Intel also faces a lawsuit filed by investors in August and a smaller workforce. The company let go of 15,000 employees this year — 15% of its total workforce.

A big part of the company’s turnaround efforts seems to hang on the 2022 U.S. CHIPS Act, which granted close to $30 billion to the company through direct funding and low-interest loans. Less than a week ago, Intel announced $7.86 billion of funding under the act, which is the first round of funding it has seen.

This investment largely targets Intel’s foundry business. The company’s 18A node is in development and with contracts with players like Microsoft and the U.S. Department of Defense. Despite that, Intel had to cancel its 20A node and outsource production to TSMC for Lunar Lake and Arrow Lake. In addition, the Biden administration has reportedly encouraged Intel to consider selling its chip design business to a rival, such as AMD.

The news comes just days before Intel is expected to reveal its next-generation Battlemage GPUs. This is the second generation of Intel’s desktop graphics cards, and they’re expected to target gamers on a budget.