Intel’s next chief executive officer will have manufacturing expertise as well as experience in the product side of the business, interim co-CEO David Zinsner said on Wednesday.

Reuters reported on Tuesday that Intel has started evaluating a handful of outsiders including former board member Lip-Bu Tan to take the reins of the struggling chipmaker, a day after the company announced the resignation of CEO Pat Gelsinger following impatience with the pace of a costly turnaround.

“I’m not in the process, but I’m guessing that the CEO will have … both some capability around foundry as well as on the product side,” Zinsner said at the UBS technology conference, adding that Intel’s core strategy remains intact.

Zinsner said there was no change to the forecast provided during the company’s previous earnings report in October when it expressed optimism about the future of its PC and server business.

The company also requires a significant cultural change to become a successful foundry player as well as in the semiconductor business, Intel’s head of foundry manufacturing and supply chain Naga Chandrasekaran said.

Intel’s shares have fallen more than 55% so far this year after it largely missed out on the artificial intelligence boom and trails behind industry heavyweight Nvidia. Intel lost its spot on the blue-chip Dow Jones Industrial Average index last month and was replaced by AI chip firm Nvidia.

Chandrasekaran said Intel’s progress on the 18A advanced node manufacturing process was going as expected and has met several milestones despite facing difficulties and technical problems.

“There’s nothing fundamentally challenging on this node now. It is about going through the remaining yield challenges, defect density challenges,” he said.

Intel plans to provide samples of chips made with the new node to customers in the first half of next year, and start to ramp the production at its Oregon plant in the second half, Chandrasekaran added.

Foundry Business

Intel’s foundry business, which was at the center of Gelsinger’s turnaround plan, will also start to see better margins by the next year, mostly influenced by its Lunar Lake processors, Zinsner said.

He said the foundry would see additional cost reductions and a mix of higher margin wafers which should improve their business.

Intel invested heavily in its manufacturing business over the past few years in the hopes of restoring its lead in making the fastest and smallest computer chips, a crown it lost to Taiwan Semiconductor Manufacturing Co which makes chips for Intel rivals such as Nvidia.

© Thomson Reuters 2024

Last Updated:December 02, 2024, 20:41 IST

Intel has announced its two senior leaders, David Zinsner and Michelle Johnton Holthaus, as interim co-CEOs.

Intel CEO Pat Gelsinger.

Intel Corporation on Monday said its CEO Pat Gelsinger has retired from the company. Gelsinger, whose retirement comes after over 40 years of career, has also stepped down from the board of directors, effective December 1, 2024. The struggling chipmaker has announced its two senior leaders, David Zinsner and Michelle Johnton Holthaus, as interim co-CEOs.

Frank Yeary, independent chair of the board of Intel, will become interim executive chair during the period of transition, Intel said in a statement.

“Intel Foundry leadership structure remains unchanged,” the company said.

Zinsner is executive vice president and chief financial officer, and Holthaus has been appointed to the newly created position of CEO of Intel Products, a group that encompasses the company’s Client Computing Group (CCG), Data Center and AI Group (DCAI) and Network and Edge Group (NEX).

In the statement, Gilsinger said, “Leading Intel has been the honor of my lifetime – this group of people is among the best and the brightest in the business, and I’m honored to call each and every one a colleague. Today is, of course, bittersweet as this company has been my life for the bulk of my working career. I can look back with pride at all that we have accomplished together. It has been a challenging year for all of us as we have made tough but necessary decisions to position Intel for the current market dynamics. I am forever grateful for the many colleagues around the world who I have worked with as part of the Intel family.”

Gelsinger, 63, has held various roles at Intel thoughout his career, he has driven significant innovation and advanced not only the business but the broader global technology industry. A highly respected leader and skilled technologist, he has played an instrumental role in focusing on innovation while also creating a sense of urgency throughout the organization. Gelsinger began his career in 1979 at Intel, growing at the company to eventually become its first chief technology officer.