Intel's new CEO to come from outside

Following the surprising dismissal of CEO Pat Gelsinger on Monday, Intel is looking for a successor. According to media reports, the Board of Directors has several external candidates in mind: Lip-Bu Tan from Cadence Design Systems, who resigned from the Board of Directors in the summer in a dispute over Intel's direction, and Matt Murphy, CEO of chip manufacturer Marvell Technologies.

According to reports, Intel has commissioned a headhunting firm to search for the new CEO. The search is still at an early stage and no candidate is a favorite, reports the news agency Reuters, citing company sources. Accordingly, the search is to focus on external candidates.

Search for candidates

Up to now, Intel CEOs have usually had sufficient pedigree. The exception: Bob Swan. He initially took over the management position on an interim basis following the resignation of Brian Krzanich and was then officially enthroned in 2019. Intel already had problems under Swan, which Pat Gelsinger was supposed to solve from 2021.

Tan can look back on a long career in the industry. The former CEO of chip design company Cadence Designs Systems had been a member of Intel's Board of Directors since 2022 and left the board in August following a dispute over Gelsinger's course. Cadence Design Systems develops software and hardware for the design of semiconductors.

Tan brought a lot of expertise to Gelsinger's plan to turn Intel into a leading chip contract manufacturer. However, there was a dispute in Intel's management about the concrete form this would take. Tan apparently missed the appreciation of his many years of experience – and resigned in August.

As CEO of chip manufacturer Marvell, Murphy is another candidate for the top job at Intel. On Tuesday, Marvell presented its quarterly figures, which were better than expected. The company is confident about the rest of the financial year – and the share price rose noticeably.

Following Gelsinger's departure, the cards are being reshuffled at Intel. Previous plans to split up the company, for example, had failed due to resistance from the CEO. Now everything seems to be back on the table. What course Intel will now take is still completely open.

Split-up option

According to media reports, the Board of Directors has discussed a number of options in recent months. One of these was to split Intel into a chip designer and a contract manufacturer. Gelsinger was against this. While the design division is likely to be attractive to investors, observers believe that the foundry is not so easy to sell.

A sale of the entire company was apparently also discussed. Qualcomm had signaled its interest, but this had recently cooled down again. Should Intel now decide to sell some parts of the company, Qualcomm may at least risk a look.

Candidates for the sale of parts of the company include Altera and Mobileye. Intel acquired the FGPA specialist Altera in 2015, then fully integrated it and spun it off again in spring 2024 – apparently with the aim of selling Altera. Mobileye, which develops systems for autonomous vehicles, was floated on the stock market again by owner Intel in 2022.

It is certainly no coincidence that the head of finance at Nvidia is speaking out in this mixed situation and bringing possible takeovers into play. The company is booming thanks to AI and is sitting on a huge pile of money that wants to be invested. This could also be "some kind of merger or takeover", said Colette Kress at an investor conference on Tuesday.

Intel's crisis is also having an impact on Germany: The chip factory near Magdeburg planned with billions in subsidies from the German government will not be built for the time being. The plans were put on ice under Gelsinger. Only for two years, it was said in September. Now there is a crisis and Intel is looking for a new boss and a new strategy. Magdeburg will have to wait.

(vbr)