Intel’s board of directors ousted CEO Pat Gelsinger after losing confidence in his ambitious turnaround strategy. The move comes as Intel posted significant losses, including $16.6 billion in Q3 2024, its worst quarterly result ever. Under Gelsinger’s leadership, Intel struggled to compete in the AI chip market dominated by Nvidia, while facing manufacturing challenges and declining data center revenue.
Analysts suggest the board may be considering splitting off Intel’s foundry business, though such a move could face scrutiny from the U.S. Commerce Department due to $8 billion in CHIPS Act funding. The Verge adds: But Moorhead and Creative Strategies analyst Ben Bajarin both believe Gelsinger’s departure was so sudden, it can’t simply have been the straw that broke the camel’s back. “There must have been a decision the board made that he was not going to stick around for,” Moorhead tells me.
His hunch: Intel’s board may want to split off its foundry business entirely, above and beyond the spinoff that Gelsinger already announced, turning Intel into a company that simply designs chips like its direct rivals.
