Intel CEO Bob Swan is Stepping Down for This Reason

Much of Wall Street was surprised to learn this week that Intel CEO Bob Swan is stepping down and in his place will be VMWare CEO Pat Gelsinger.

The company announced the news this week with Swan expected to step down effective February 15th.

It was not long ago that Dan Loeb’s Third Point hedge fund urged Intel’s board to explore “strategic alternatives.”

Shares of Intel saw a gain of almost 7% on Wednesday on the news while VMWare’s stock fell almost 7%.

Swan had been head of Intel since January of 2019 after serving as the company’s interim CEO for seven months.

Loeb called Swan “a class act” and said he “did the right thing for all stake holders stepping aside for Gelsinger” on his Twitter. Gelsinger has been the CEO of VMWare since 2012.

“Pat is a proven technology leader with a distinguished track record of innovation, talent development, and a deep knowledge of Intel. He will continue a values-based cultural leadership approach with a hyper focus on operational execution,” said Omar Ishrak, independent chairman of the Intel board.

“After careful consideration, the board concluded that now is the right time to make this leadership change to draw on Pat’s technology and engineering expertise during this critical period of transformation at Intel. The board is confident that Pat, together with the rest of the leadership team, will ensure strong execution of Intel’s strategy to build on its product leadership and take advantage of the significant opportunities ahead as it continues to transform from a CPU to a multi-architecture XPU company.”

“I am thrilled to rejoin and lead Intel forward at this important time for the company, our industry and our nation,” said Gelsinger. “Having begun my career at Intel and learned at the feet of Grove, Noyce and Moore, it’s my privilege and honor to return in this leadership capacity. I have tremendous regard for the company’s rich history and powerful technologies that have created the world’s digital infrastructure. I believe Intel has significant potential to continue to reshape the future of technology and look forward to working with the incredibly talented global Intel team to accelerate innovation and create value for our customers and shareholders.”

“The board and I deeply appreciate Bob Swan for his leadership and significant contributions through this period of transformation for Intel,” added Ishrak. “Under his leadership, Intel has made significant progress on its strategy to transform into a multi-architecture XPU company to capitalize on market shifts and extend Intel’s reach into fast-growing markets. Bob has also been instrumental in reenergizing the company’s culture to drive better execution of our product and innovation roadmap. He leaves Intel in a strong strategic and financial position, and we thank him for his ongoing guidance as he works with Pat to ensure the leadership transition is seamless.”

“My goal over the past two years has been to position Intel for a new era of distributed intelligence, improving execution to strengthen our core CPU franchise and extending our reach to accelerate growth,” said Swan. “With significant progress made across those priorities, we’re now at the right juncture to make this transition to the next leader of Intel. I am fully supportive of the board’s selection of Pat and have great confidence that, under his leadership and the rest of the management team, Intel will continue to lead the market as one of the world’s most influential technology companies.”

Intel said it expects fourth quarter 2020 revenue and earnings to exceed prior guidance. The company said it “has made strong progress” on its latest generation 7 nanometer chips.

Intel will reports its earnings on Jan. 21.

Disclaimer: We have no position in any of the companies mentioned and have not been compensated for this article.