Intel (INTC) is racing against the clock to find a new CEO who can launch the company into the age of artificial intelligence, or risk sinking into irrelevance.
A series of strategic mistakes dating back to the early 2000s and a failure to develop cutting-edge technologies culminated in the once-dominant chipmaker’s dramatic fall in 2024, when its shares plunged 55%.
Its board of directors ousted CEO Pat Gelsinger in December and appointed two temporary co-CEOs.
The move exposed the board’s lack of a coherent strategy and called into question the fate of Gelsinger’s bold turnaround plan: opening up Intel’s manufacturing business to make chips for outside customers (i.e., operating a foundry).
“I think it’s the board that should have been fired, not him,” analyst William Lazonick, who has written extensively about Intel for the Institute for New Economic Thought, told Yahoo Finance.
Since Gelsinger’s departure, the board has added two semiconductor experts, former ASML CEO Eric Meurice and Microchip President Steve Sanghi. Before his addition, only two of the 11 board members had experience in the semiconductor industry, according to Citi analyst Christopher Danley.
An Intel analyst on Wall Street said Meurice and Sanghi “are already… challenging the plans.” [and] processes within Intel.” They asked to remain anonymous because they were not authorized to speak publicly about the matter.
Intel declined to comment on its CEO search.
Yahoo Finance spoke with analysts and several former top Intel executives, who offered their thoughts on who Intel’s board of directors might select to take the helm of America’s only large-scale cutting-edge chipmaker.
The aforementioned Intel analyst told Yahoo Finance that temporary co-CEO David Zinsner “doesn’t want the job.” Several people with knowledge of the situation said Zinsner’s counterpart, Michelle Johnston Holthaus, is being considered for the role. One former executive said the Intel veteran, who heads its product group, “has a chance.”
The former executive and another former senior executive in Intel’s manufacturing division criticized Holthaus for lacking technical skills, a quality that analysts and Intel experts agree is imperative in its next leader.
“She never has an independent idea. She never pushes an agenda,” said one of the former executives. Intel describes Holthaus as “a proven leader and general manager.”
Moor Insights & Strategy analyst Anshel Sag said the chipmaker will likely choose someone not currently with the company, but that the decision will take some time.
“As someone who is very connected within the company, I haven’t had the sense that they are even remotely close to choosing someone,” Sag told Yahoo Finance.
Bloomberg, citing unnamed sources, reported that Intel’s external candidates include former Cadence Design Systems (CDNS) CEO Lip-Bu Tan, Marvell Technology (MRVL) CEO Matt Murphy, board member Intel CEO Stacy Smith, Ampere Computing founder Renee James, Apple (AAPL) internal chip chief Johny Srouji, Analog Devices (ADI) executive Gregory Bryant and Lenovo’s Kirk Skaugen (0992.HK).
Five of those “outsiders” previously worked at Intel. Several of them spent more than a decade at the company and were ousted under former CEO Brian Krzanich.
The Intel analyst also mentioned Boeing (BA) Chairman and former Qualcomm (QCOM) CEO Steve Mollenkopf and Eclipse Ventures General Partner Sanjay Jha as possible candidates.
Sources have mixed opinions on whether you should hire an insider who knows the company well.
“Intel needs to be examined by a fresh set of eyes free of previous affiliations,” Futurum Group analyst David Nicholson told Yahoo Finance.
Stacy Rasgon, a semiconductor analyst at Bernstein, said Lip-Bu Tan is the candidate “many shareholders would love to see” to fill the role. Tan previously served on Intel’s board of directors, but resigned in August because he disagreed with Intel’s foundry strategy, a plan Gelsinger aggressively pursued. The former executives agreed that Tan is “well-respected” and, in many ways, an ideal person for the job.
“Lip-Bu knows how to achieve radical change, how to reinvent a business, how to incentivize change. He also knows how resistant Intel is to change,” the aforementioned Intel manufacturing executive told Yahoo Finance.
However, according to analysts, Tan would not be interested in such a leadership role at this point in his career. Tan also serves on the board of directors of Gelsinger’s Christian organization.
One of the former senior executives with knowledge of the matter said Tan is still deciding whether he would consider taking the job.
One of the five former Intel executives is the founder of artificial intelligence startup Ampere, Renee James, who was described by two of the former executives as “strategically brilliant” and “execution-oriented.”
However, one of the sources, who worked at the company for decades, said James does not have a good enough relationship with the board to be a top choice.
Stacy Smith, an Intel board member who previously worked at the company for nearly 30 years, including as chief financial officer for about a decade, was described by the former Intel manufacturing executive as “trusted, respected and well-liked.”
Smith recently oversaw the initial public offering of Japanese company Toshiba’s chip business as its chief executive, which in recent years was renamed Kioxia. The completion of Kioxia’s initial public offering opens the door for Smith to take the Intel job, one of the former executives said.
The former executives also praised Kirk Skaugen, a former engineer who held executive positions in Intel’s PC and data center business. Apple’s Srouji and Marvell’s Murphy are well-versed in semiconductors, but sources doubt either of them will take the top job.
Wall Street has mixed opinions on how long the search for a CEO will take. In a Jan. 8 client note, Danley suggested the process could conclude “in the coming months,” writing that “the company is relatively advanced in the process.” Meanwhile, KeyBanc’s John Vinh wrote in his own note the same day that the process would likely take four to six months.
“The board is currently seeking external candidates without strict deadlines,” Vinh said.
Last Friday, Intel shares popped on a report that an unnamed company is trying to acquire the company. Analyst Dylan Patel suggested Elon Musk, while Citi wrote that Broadcom would be the most likely buyer. Last year, Qualcomm reportedly explored an acquisition before interest cooled.
Intel did not respond to a request for comment on the acquisition rumors.
Meanwhile, US officials are considering a merger between US chipmaker GlobalFoundries and Intel, according to Bloomberg.
But until a new CEO is found, the chip giant is paralyzed. “The interim CEOs… will avoid altering the overall grand strategy irreversibly,” Vinh, the KeyBanc analyst, added in his note.
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Yasmin Khorram is a senior reporter at Yahoo Finance. Follow Yasmin on Twitter/X @YasminKhorram and in LinkedIn. Send newsworthy tips to Yasmin: yasmin.khorram@yahooinc.com
Laura Bratton is a Yahoo Finance reporter. Follow her on Bluesky @laurabratton.bsky.social. Email her at laura.bratton@yahooinc.com.
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