Intel Removes Pat Gelsinger

No details yet but a lot to think about

Dec 2, 2024 by

Intel LogoIn today’s unexpected earthquake news, Pat Gelsinger has stepped down from Intel. As of this writing, SemiAccurate hasn’t heard much more than the official news surrounding the departure.

Officially Pat just retired, something we have trouble believing given his enthusiasm for the job and for Intel itself. He was the right man for the job and did a lot of good for the technical side of the business. On the financial side there were a series of missteps and lots of ruffled feathers. This showed in the stock price, up 4+% as of this writing.

For the moment Pat Gelsinger is being replaced by David Zinsner and Michelle Johnston Holthaus, both leaning toward the business side of things. This isn’t good or bad but it does represent a shift from Pat’s orientation. Whether this was intentional or not is a question for later days, for the moment it just is. SemiAccurate doesn’t know Mr Zinsner but has very high regard for Ms Johnston Holthaus.

So why did Pat retire? We have no clue. Did he do a good job? From Our perspective he really did on the technical front. If you look at the steaming pile of skeletons in the closet he was handed by the previous two CEOs, it was pretty stunning anyone competent would have touched the job much less taken it with the enthusiasm Pat did. Do recall the depths of the 10nm debacle that was flaring up when Pat took over. Intel couldn’t make a chip with yields in the upper two digits (Don’t ask but we can back that up) and the future was far less hopeful.

Pat cleaned this up. Under his tenure the company went from making technical decisions to benefit the individual making the decision to decisions that benefited the company as a whole. This was a sea change and led to the departure of many a manager who was detrimental to Intel as a whole, and a few who shouldn’t have been axed. That said if you had asked SemiAccurate how things were going at Intel, we would have been enthusiastically positive at their direction. Sure there were still problems to be ironed out but they were being fixed.

Herein lies the big problem for Pat, finance vs tech. The tech is going well and recovering at a superlinear rate. The finance has been an utter disaster and the two sides of the company are out of sync. Why? To make a chip from scratch is a 3+ year project. For example, the first chip that Jim Keller had complete control over, Sierra Forest, came out in mid-2024. Keller _LEFT_ Intel in June, 2020. The first GPU Raja Koduri had complete control over is due to be released this month. Diamond Rapids spec sheets were making the rounds in July, 2019 for a chip that may be out next year.

Compare and contrast this with the time frames for financial folk, 3-4 quarters. The disaster of Intel margins and income are due to the people who preceded Pat, not due to his actions. Pat just caught the spears thrown by others, the decisions and changes he made are just starting to hit the market now. Will they be good? Lunar Lake was pretty solid. Meteor and Arrow Lake were… less so but they were architected and frozen at a time when Intel was unsure they could make a chiplet much less a chip. They bore huge costs and overhead to make up for a disastrous process, and once things got back on track that was not able to be changed.

Looking out at the future devices, Intel has a good chance of improving more rapidly than expected simply by fixing the obvious problems that were designed in by the process failures. In short we expect things to get better fast but, well, the finances will still be painful for a bit. And Pat knew this and likely took the fall for it, but he probably cleaned the decks for the next full time CEO.

So this disconnect between finance and tech was ruinous for Intel, but what can you do about it? If silicon companies keep replacing management at the first sign of problems, the problems will never be resolved, see Samsung’s inability to make logic parts for more here. Did this just happen at Intel? We honestly don’t know yet but SemiAccurate hopes this isn’t the case.

In the end what just happened? Pat Gelsinger retired from Intel and David Zinsner and Michelle Johnston Holthaus took over as interim co-CEOs. Wall Street rejoiced and the technical folk are far less amused. Is it the right decision? That is too early to tell but there is no going back from here.S|A

Note: Bloomberg is claiming the Gelsinger was forced out by the board but the story is paywalled so I can’t link it directly. This is quite believable in our eyes and is partially backed up by our sources.

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Charlie Demerjian

Roving engine of chaos and snide remarks at SemiAccurate
Charlie Demerjian is the founder of Stone Arch Networking Services and SemiAccurate.com. SemiAccurate.com is a technology news site; addressing hardware design, software selection, customization, securing and maintenance, with over one million views per month. He is a technologist and analyst specializing in semiconductors, system and network architecture. As head writer of SemiAccurate.com, he regularly advises writers, analysts, and industry executives on technical matters and long lead industry trends. Charlie is also available through Guidepoint and Mosaic. FullyAccurate