Intel The Search for a New Chief Executive Officer Corp. will focus heavily on third parties, with the chipmaker considering candidates such as Marvell technology manager inc. Matt Murphy and ex Cadence Design Systems According to people familiar with the situation, the CEO of Inc. Lip-Boo Tan.
The company has brought in executive search firm Spencer Stewart to help find a new chief executive and is evaluating candidates, said the people, who asked not to be identified because the discussions are private. This includes finding talent far beyond Intel—a break with tradition.
The sudden ouster of CEO Pat Gelsinger this week triggered an urgent search for new leadership at a time when the chip maker’s fortunes are shaky and its bench depleted by years of leadership turnover. Gelsinger took the reins just three years ago and has since focused on a complex and expensive effort to turn around the struggling company.
That didn’t give him time to resurrect one of Intel’s other legacies, an executive training program that once provided leaders for the rest of the industry. For now, Chief Financial Officer David Zinsner and Executive Vice President Michelle Johnston Holthouse are serving as interim co-CEOs.
Marvell shares fell 2.3% on Tuesday after Bloomberg News reported that Murphy was under consideration. Intel fell more than 5% as of 1:09 p.m. in New York, continuing a retreat that began on Monday.
All but one of the company’s executives since its founding in 1968 have been homegrown, with the exception, Bob Swan, given the job as an interim measure when the board was forced to fire Brian Krzanich. The drama interrupted a series of carefully planned successions that had contributed to the company’s five decades of stability. A number of Intel veterans also left during Krzanich’s tenure.
As the board searches for a permanent replacement for Gelsinger, it may have a hard time picking from within, analysts said, in part because earlier departures mean there are fewer strong internal candidates. On the other hand, there is little optimism that the company will be able to attract an external savior who can immediately shake things up.
“It may be difficult to find a replacement with the right experience and education, the ability to lead an organization as complex as Intel, and the ability to effectively deal with the many headwinds,” KeyBanc Capital Markets analyst John Vigne wrote on Monday. .
Intel declined to comment on potential CEO candidates. Marvell, Murphy and Tan did not immediately respond to requests for comment. Reuters previously reported that 65-year-old Tan, who served on the board of Intel until the beginning of this year, was fighting for a job.
One way to balance the insider-outsider equation is to hire an old Intel executive who left during the management turmoil of recent years — like Gelsinger.
Among those candidates will be Stacey Smith, a former Intel executive who joined the company’s board of directors this year. Intel’s former CFO, who also worked in the company’s sales department, left during Krzanich’s tenure in 2018 and was previously a contender for the top job. The latest departure is Gregory Bryant, who headed Intel’s personal computer division. He joined Analog devices Inc. in 2022.
Also in that cohort is Ampere Computing LLC CEO Renee James, who founded a startup trying to compete with Intel in server chips. She served as president of Intel until Krzanich stepped down. Ex Lenovo Group Head Ltd. Kirk Skowgen, who left Intel in 2016, was in charge of Intel’s server chip unit when it dominated the industry.
Another potential recruiting pool: Intel’s biggest customers, many of which have launched their own chip programs with varying degrees of success. Johnny Srouji is Senior Vice President an apple A successful internal chip from Inc. The iPhone maker’s internal program started a trend that has repeated itself in another placeprimarily by AmazonA division of AWS .com Inc. Microsoft Corp., Alphabet Inc Google and Metaplatforms Inc. also created significant chip teams.
When Intel tried to bring Gelsinger back to the company about four years ago, it was reported that several other chip executives, including Marvell’s Murphy, were being considered. Intel has now turned to him for the latest search, the people said.
Despite its serious decline destiniesIntel remains one of the most important companies in the technology industry. It is still one of the largest chipmakers by revenue, and more than 70% of personal computers and servers in the world run on its processors. His plan to build additional plants in the US is a cornerstone of the federal government’s effort to produce more chips on American soil.
Whoever Intel chooses, it will take time for the new CEO to make up for the more than $20 billion in revenue lost to competitors over the past couple of years.
“In addition to not having a bench, a new outside CEO coming to Intel is a multi-year gig, which is a tall order in an innovation cycle that is more intense than ever,” said Rosenblatt Securities analyst Hans Mosesmann.
Given the technical nature of the industry — chip design and manufacturing requires a combination of electronics, chemistry and physics, typically handled by teams of PhDs — Intel may not want to promote CFO Zinner on a permanent basis. When CFO Swan was the company’s interim chief, analysts questioned whether he understood the technical side of the business well enough to make strategic decisions.
Gelsinger, who returned to Intel after a decade away, talked about his connection to the company’s past and his plan to rebuild its strengths. Now that may no longer be a selling point. The immediate need to win over Intel’s rivals and turn them into customers for its outsourced manufacturing business may involve ousting longtime Intel acolytes.
If the board of directors is looking for directly transferable skills, Taiwanese semiconductor manufacturing Co., Advanced Micro Devices Inc. and Nvidia Corp. will be the most obvious talent pool. During the company’s most recent CEO search, many analysts mentioned AMD’s Lisa Su as the favorite. But since then, the company she runs has seen even more success, taking market share from Intel and becoming a major competitor to catch up with Nvidia in AI chips. AMD is currently worth more than double Intel’s market cap.
Hiring at Nvidia can also be challenging. Co-founder and CEO Jensen Huang has created a unique management structure that eschews traditional hierarchy. Huang has dozens of direct reports in a horizontal structure, making it nearly impossible to determine which of them might be in the best position to step up — at Nvidia or at another company, such as Intel.
Meanwhile, Taiwan’s TSMC has overtaken Intel in manufacturing capacity to become the leading manufacturer of chips for other companies. It makes the world’s most advanced chips that power Apple, AMD, Nvidia and many others. At its Hsinchu headquarters, among the executives seen as important in guiding TSMC’s rapid ascent is an Intel veteran Kevin Zhang and his co-chief operating officer peer Cliff Howe. In the US, TSMC Arizona CEO YL Wang recently had a notable triumph in helping that plant achieve more productivity than its comparative object at home.
It’s unclear, however, whether TSMC’s top executives would consider ditching the world’s top chipmaker under contract to save a much less stable company. But former TSMC chairman Mark Liu, who spent some of the early years of his career at Intel and is set to retire from the Taiwanese chipmaker as early as 2024, could be someone Intel could lure — even if he’s older than the average American CEO. Liu turns 70 this year.
“We don’t expect it to be easy for Intel to find a new leader with the authority to lead Intel out of this mess,” Wolfe Research analyst Chris Caso wrote in a report. “Gelsinger came with a wealth of experience at Intel, and there weren’t many viable candidates.”
