'Closer' Gelsinger Resigns Without Finding Breakthrough
Intel Falls from Semiconductor Kingdom to M&A Target
Pat Gelsinger, the CEO who was brought in as the savior of the fallen "King of Semiconductors," Intel, has ultimately stepped down. Intel's stock price is rising more than 4% in pre-market trading on the New York Stock Exchange.
On the 2nd (local time), Intel announced that CEO Gelsinger left the company as of the 1st. David Zinsner, Chief Financial Officer (CFO), and MJ Hultquist, President of Intel's Products Group, were appointed as interim co-CEOs.
Gelsinger's resignation came just a week after Intel secured government subsidies totaling $7.86 billion for factory construction based on the CHIPS Act and other legislation.
Since taking office as Intel CEO in 2021, Gelsinger devoted himself to reviving the company, which had fallen far behind in the semiconductor market. Intel was once the top IT company dominating the semiconductor industry, holding a 90% market share in personal computer central processing units (CPUs) in the 1990s. However, it failed to respond to the market shift toward mobile devices following the launch of the iPhone in the mid-to-late 2000s and fell significantly behind. After becoming CEO, Gelsinger invested tens of billions of dollars in the foundry business to save the company, but Intel was largely outcompeted by companies from Korea, Taiwan, and China and did not succeed. Even amid the AI boom, Intel failed to find opportunities and its business fell into stagnation.
As a result, Intel's stock price plummeted 52% this year alone, and the company suffered the humiliation of being removed from the Dow Jones Industrial Average after 25 years of inclusion.
Intel eventually announced large-scale restructuring plans, including a 15% workforce reduction next year and $10 billion in cost savings. Rumors even circulated last September that Qualcomm might acquire the company.
CNBC reported, "Intel has been in a prolonged slump as it lost market share in its core business and failed to pioneer the AI market. Once the top semiconductor company in the U.S., Intel's stock price and market share plunged further during Gelsinger's tenure, which ended nearly four turbulent years."
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