Who will save Intel after the surprise departure of its CEO Pat Gelsinger?

After almost four years at the helm of the Intel liner, the company's CEO Pat Gelsinger is retiring.after a brilliant career of more than 40 years and (…) he resigned from the board of directors, effective December 1, 2024“, according to the official press release.
The company does not remain without pilots, since for the moment it is David Zinsner and Michelle Johnston Holthaus who are co-CEOs.while the board of directors searches for a new CEO“.

This news comes as Pat Gelsinger had just released the $7.86 billion promised in 2022 by the Chip Act, the American recovery plan for his semiconductor industry.

In the official statement, Pat Gelsinger emphasizes that “leading Intel has been the honor of my life – this group of people are among the best and brightest in the industry, and I am honored to consider each of them a colleague . Today, of course, is bittersweet, because this company has been my life for most of my professional career. » It should be remembered that Gelsinger joined the company when he was barely 19 years old in 1979. And that he spent thirty years there before taking over the management of the software giant VM Ware (now owned by Broadcom). in 2009. To return to the head of Intel in January 2021.

Catapulted into retirement in a period of doubt

As renowned semiconductor analyst Ian Cutress points out, there are three reasons for a surprise retirement at the helm of such a strategic company: health reasons, family reasons or a decision unilateral decision of the board of directors.

The least worst would therefore be for P. Gelsinger if it was this third solution. A decision by the board of directors to thank the man for his work, but to quickly move on to accelerate Intel's transformation.
A company that was once the queen of chips, but which now has too many failures to its credit. Namely the shift in mobile chips, the loss of leadership in burning speed, as well as the major delay in the field of GPUs. It is perhaps this failed shift in AI which now makes the fortune of Nvidia and, to a lesser extent, of AMD, which cost P. Gelsinger his place.

The big unknown being knowing, in the event that this decision is indeed that of Wall Street, whether the long term has been taken into account.

Semiconductors, or the weight of long-term decisions

In less than four years, P. Gelsinger has relaunched the Intel machine. The engraving machine on the one hand, since under its control the company continued its catch-up with TSMC. The Intel 18A node planned for 2025 should, according to analysts, put the company back in the race. The chip design machine on the other hand, with Lunar Lake, its first generation of mobile chips capable of offering endurance capable of competing with AMD, Apple or Qualcomm. Or its future server chips, with the highly anticipated Sierra Forest and its 288 cores.

But Intel is not a simple SME to be put back on track: it is an industrial giant with more than 100,000 employees operating in a world where R&D and investments work over the long term. It took Lisa Su a good six years between 2014 and 2020 for AMD to deliver a competitive mobile PC architecture!

On the Intel side, P. Gelsinger had to manage not only the restarting of the CPU teams, but also those of the GPUs, a crucial technology in AI calculation, as well as the industrial device. An industrial device for which Pat Gelsinger championed Western production. After a COVID period marked by shortages caused by the world's dependence on the Asian semiconductor supply chain, Gelsinger has indeed scoured the world to find subsidies and determine production sites not only in the USA, but also in Europe.

Those who know the development times of architectures, both from a microelectronics and software point of view, know that catching up with Nvidia (GPU, AI) or Apple/ARM (CPU) does not happen in four years. But the division by more than twice the value of Intel's shares in four years undoubtedly made investors react. Who are neither satisfied with the company's performance, nor were appeased by the departure plan announced by Intel last August to reduce costs (15,000 positions eliminated).

It now remains to find a better CEO for one of the most strategic companies of American technological sovereignty. A mission just as tough as the one Pat Gelsinger accepted.