Intel replaces its chief executive after 2 years

Intel is replacing its CEO after only two years, but it has been a rough stretch for the chipmaker.

Bob Swan, who became the company's chief executive in early 2019, will be replaced in mid-February by industry veteran Pat Gelsinger.

Shares spiked 8% on news of the change at the top.

The Santa Clara, California, company said Wednesday that the change in leadership is unrelated to its financial performance last year, but the surprise shakeup followed several weeks of investor activism by hedge fund Third Point, which had pushed for big changes.

Intel acknowledged in late December that it had received a letter from the fund and was working with it on ideas “regarding enhanced shareholder value.”

In mid-2020, Intel disclosed that there would be a substantial delay in its development of a next-generation chip-making process already in use by a major Taiwan supplier, TSMC.

The unexpected snag meant that Intel’s 7-nanometer processing technology is unlikely to be ready until the end of 2022 or early 2023, potentially putting the company behind its rivals.

Gelsinger has been the CEO of VMware since 2012 and has more than four decades of experience in the tech industry. He spend most of that time with Intel Corp., where he began his career and was its first chief technology officer.

Intel Chairman Omar Ishrak said in a prepared statement that “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.”

Swan, a former chief financial officer at Intel, assumed interim leadership in 2018 after CEO Brian Krzanich resigned after the company learned of what it called a past, consensual relationship with an employee. After a search, Intel confirmed Swan as CEO in early 2019.