Stock Price Halved, CEO Paid 14 Billion Won to Leave? ... Angry Intel Shareholders

Scheduled to be paid over 18 months

Pat Gelsinger, the former CEO who was brought in as a savior for struggling Intel, has ultimately left the company, sparking controversy over the severance pay he is set to receive. Despite the company facing an unprecedented crisis, Gelsinger is reported to be receiving compensation amounting to $10 million (approximately 14.1 billion KRW).

On the 3rd (local time), Intel closed at $22.47 (about 31,709 KRW) on the New York Stock Exchange, plunging 6.10% compared to the previous trading day. On that day, local financial media such as Yahoo Finance reported that the excessive severance pay for former CEO Gelsinger, who resigned taking responsibility for Intel's management difficulties, has sparked dissatisfaction among shareholders.

Pat Gelsinger, former CEO of Intel. Reuters Yonhap News

In documents submitted to the U.S. Securities and Exchange Commission (SEC), Intel explained that Gelsinger’s severance pay includes 18 months of his current base salary amounting to $1.25 million (approximately 176.437 million KRW), as well as a bonus equivalent to 1.5 times his base salary, or 275%. This amount will be paid out over 18 months. Additionally, he will receive a pro-rated bonus for this year based on 11 months of work, depending on company performance. When combined, the total reaches $10 million.

Meanwhile, U.S. broadcaster CNBC reported that Intel is considering an external candidate as Gelsinger’s successor, breaking the company’s tradition of promoting internal candidates to CEO.

Gelsinger initially raised expectations when he took office as Intel CEO in 2021. Intel once dominated the PC central processing unit (CPU) market and rose to become the world’s largest semiconductor company, but since the 2000s, it has fallen behind competitors in mobile application processors (AP) and cloud sectors, leading to stagnation.

Ultimately, Intel’s stock price has plummeted 52% this year alone, and the company suffered the humiliation of being removed from the Dow Jones Industrial Average (Dow Index) after 25 years of inclusion. Next year, Intel plans to cut 15% of its total workforce and undertake large-scale restructuring, including $10 billion in cost reductions.

Regarding this, CNBC pointed out, "Intel has lost market share in its core business and failed to pioneer the AI market, resulting in a prolonged slump," adding, "During Gelsinger’s tenure, the stock price and market share have fallen even further."