Intel CEO Pat Gelsinger Retires Amid Struggles: Zinsner and Johnston Holthaus Named Interim Co-CEOs

Intel Corporation, the once-dominant giant in the semiconductor industry, announced on Monday the surprise retirement of its CEO, Pat Gelsinger, marking the end of an era and signaling a period of uncertainty for the struggling chipmaker. Gelsinger’s departure comes amid mounting financial challenges and increased competition in the rapidly evolving tech landscape.

David Zinsner, Intel’s Executive Vice President and Chief Financial Officer, and Michelle Johnston Holthaus, CEO of Intel Products, have been named interim co-CEOs as the company initiates its search for Gelsinger’s successor. Frank Yeary, independent chair of Intel’s board, will step into the role of interim executive chair during the transition.

Gelsinger, who began his career at Intel in 1979 and later became its first Chief Technology Officer, returned to the company as CEO in 2021 at a critical juncture. His retirement, effective immediately, also includes his resignation from the company’s board.

“Pat spent his formative years at Intel and returned to lead during a pivotal time,” Yeary said in a statement. “His contributions to process manufacturing and innovation have left an indelible mark on the company.”

In his farewell statement, Gelsinger described his departure as “bittersweet,” reflecting on over four decades at Intel. “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.”

Gelsinger’s exit highlights Intel’s struggles to maintain its relevance in an industry that has rapidly shifted toward artificial intelligence and advanced chip designs. Once a symbol of U.S. technological prowess, Intel has been overshadowed by competitors like Nvidia, which recently surpassed Intel in market dominance and replaced it on the Dow Jones Industrial Average.

Intel’s financial woes have been mounting. In its most recent quarter, the company reported a staggering $16.6 billion loss, suspended its dividend, and saw its stock value plummet by about 60% since Gelsinger assumed the CEO role. Efforts to cut costs, including the announcement in August of a 15% workforce reduction—approximately 15,000 jobs—highlight the depths of its financial difficulties.

Strategic Shifts and Gelsinger’s Legacy

Despite these challenges, Gelsinger initiated ambitious plans to reinvent Intel’s business model. Unlike many of its competitors, Intel both designs and manufactures chips. Under Gelsinger, the company sought to expand its foundry business, producing semiconductors for other firms—a move aimed at challenging industry leader Taiwan Semiconductor Manufacturing Co. (TSMC).

Gelsinger spearheaded significant investments to bolster Intel’s manufacturing capacity in the U.S. and Europe, aligning with geopolitical priorities to reduce reliance on Asian suppliers. In Ohio, Intel broke ground on a $20 billion chipmaking facility, while similar projects in Europe reflected the growing importance of semiconductor independence in Western economies.

These efforts were buoyed by federal funding from the Biden administration, which pledged billions to support U.S. semiconductor manufacturing as part of a broader push to counter China’s dominance in the tech sector. However, Intel faced a setback last week when the administration reduced its federal grant allocation from an expected $8.5 billion.

The search for a new CEO comes at a critical juncture for Intel, which must navigate fierce competition from Nvidia, TSMC, and other global players, all while addressing its own operational inefficiencies. Zinsner and Johnston Holthaus, now tasked with leading the company in an interim capacity, bring complementary expertise. Zinsner, as CFO, is deeply familiar with Intel’s financial strategies, while Johnston Holthaus oversees the company’s core client computing, data center, and AI divisions—areas critical to Intel’s future growth.

Intel’s board faces the daunting challenge of finding a leader capable of steering the company through its transformation. The focus will likely be on candidates who can build on Gelsinger’s manufacturing legacy while addressing the innovation gap that has allowed competitors to outpace Intel.

Following the announcement, Intel’s shares experienced a brief uptick in early trading before closing 0.5% down, reflecting investor uncertainty about the company’s direction. The broader semiconductor industry remains on high alert, with Intel’s decisions likely to have ripple effects across the sector. As Intel grapples with its challenges, Gelsinger’s departure marks the end of a chapter for one of Silicon Valley’s foundational companies. The question now is whether the next phase of leadership can restore Intel’s standing as a trailblazer in the global tech landscape—or whether the company will continue to lose ground in a hyper-competitive market.

Intel’s next moves will be closely watched, as the company’s fortunes are not just a matter of corporate strategy but a litmus test for the future of U.S. semiconductor manufacturing in an increasingly fragmented global economy.

By Ioana Constantin