Chipmaker Intel said on Wednesday it would replace chief executive Bob Swan with VMware chief executive Pat Gelsinger from February 15th.
The company’s shares were up nearly 10 per cent in morning trading.
Intel, long the world leader in chip-making technology, has lost its manufacturing edge in recent years and is now debating whether to outsource some of its flagship central processor unit chips, or CPUs, slated for release in 2023. Activist investor Third Point last month sent Intel’s board a letter asking it to consider whether to keep its chip design and manufacturing operations under one roof.
The company employs 4,900 people in Ireland at its Leixlip, Co Kildare site.
Mr Gelsinger, a former Intel executive, has served as the chief executive of VMware since 2012. During that time, he successfully guided the company, whose software helps companies squeeze more work out of data centre servers, through the transition from privately owned data centres to public cloud providers, in part by striking a seminal deal with Amazon Web Services.
“Having begun my career at Intel and learned at the feet of Grove, Noyce and Moore, it’s my privilege and honour to return in this leadership capacity,” Mr Gelsinger said in a statement. “I have tremendous regard for the company’s rich history and powerful technologies that have created the world’s digital infrastructure.”
Beat forecast
Intel on Wednesday also said that it expects to beat its financial forecast for the fourth quarter of 2020 and that it has made “strong progress” in addressing issues with its 7-nanometer chip manufacturing technology.
"From a credibility standpoint, he's great – he's probably the one at the top of most people's list for who they would want to see," Stacy Rasgon, an analyst at Bernstein, said of Mr Gelsigner's appointment.
“He had a long career there and he’s technical, so he can address both the technical issues and cultural issues. The issue is, what’s the ship look like that he’s going to be running? The next two or three years are set in stone regardless of who is there.”
Mr Swan, a former chief financial officer from Ebay, had served as Intel's finance chief and was named its interim chief executive when Brian Krzanich resigned in June 2018. Mr Swan was made permanent chief in early 2019 after an extensive search failed to yield an external candidate. – Reuters
