Intel CEO out after affair revelation.
Brian Krzanich — only the sixth CEO in the company’s history — has also stepped down from the firm’s board
Brian Krzanich has resigned as CEO of Intel after he had a consensual relationship with an employee, the tech giant announced Thursday.
The Santa Clara chipmaker said Chief Financial Officer Bob Swan is taking over as interimchief executive, and that it has begun a search for a permanent CEO.
Krzanich — only the sixth CEO in Intel’s history since its founding in 1968 — had held the top job since 2013, when he took over for the retiring Paul Otellini. Krzanich had been chief operating officer before that, and joined the Silicon Valley tech giant as an engineer in 1982, right out of San Jose State University.
“The board believes strongly in Intel’s strategy and we are confident in Bob Swan’s ability to lead the company as we conduct a robust search for our next CEO,” said Intel Chairman Andy Bryant in a statement Thursday. “Bob has been instrumental to the development and execution of Intel’s strategy, and we know the company will continue to smoothly execute. We appreciate Brian’s many contributions to Intel.”
The company said Krzanich’s relationship with an employee, “confirmed by internal and external counsel,” violated its non-fraternization policy. The board was recently told of the relationship and immediately began to investigate.
Krzanich has also stepped down
from Intel’s board.
An Intel spokesman would not providemore details.
Krzanich, 58, is married to Brandee Krzanich, and they have two children.
Last time Krzanich made headlines was after the big Meltdown and Spectre security flaws that affected computers worldwide. Earlier this year, lawmakers questioned the timing of a big Krzanich stock sale in November, which was after he and Intel learned of the bugs but before the news wasmade public. Krzanich’s stock sale, from which he made a $24 million profit, left him owning only the minimum amount of company shares hewas required to hold.
At least two senators called on the Securities and Exchange Commission and the Department of Justice to investigate, but no investigations have been announced. The SEC declined to comment Thursday, and theDOJ did not return a request for comment.
Krzanich never rose to the iconic status of his predecessors at Intel, but he raised his profile with a stint on a company-backed reality TV show called “America’s Greatest Makers” in 2016. He also was a big backer of diversity. Intel was among the first tech giants to publicly state its commitment to and investment in diversifying its workforce.
Like other tech giants’ executives, Krzanich has spoken out against President Donald Trump, including by quitting the president’s manufacturing council last August after the president’s response to the deadly white supremacist rally in Charlottesville, Virginia. Krzanich said in a blog post at the time: “My request — my plea — to everyone involved in our political system is this: set scoring political points aside and focus on what is best for the nation as a whole.”
Now the big question is whether Intel will go in- side — by naming another insider as CEO. The chipmaker, instrumental to the rise of Silicon Valley, has never gone outside the company for a chief executive. Its first three CEOs were also co-founders: Bob Noyce, Gordon Moore and Andy Grove. Craig Barrett was an academic at Stanford University before joining Intel. Otellini, who died last year, spent hiswhole career at Intel.
When Krzanich was promoted to theCEO job, longtime Intel executive Renee James became president. She has since left the company and started a chip company, Ampere Computing.
“If Intel hires from within, itwill likely beMurthy Renduchintala orNavin Shenoy, but more than any time, I wouldn’t be surprised if the company went external,” Patrick Moorhead, president of Moor Insights & Strategy, said in an email Thursday. Renduchintala is Intel’s group president of the Technology, Systems Architecture & Client Group and chief engineer- ing officer. Shenoy is executive vice president and general manager of the Data Center Group.
Moorhead said Krzanich leaves Intel — whose dominance in personal computersmade it slow to adapt to the rise of mobile computing — in a good position.
“5G, self- driving cars, IoT and AI are the next big things and Intel is a player in all these growth segments,” Moorhead said. “Intel does need to shore up its manufacturing execution.” Other analysts agree. “Interim CEO/CFO Bob Swan… has all the pieces in place to be successful as the groundwork has been laid toward transitioning the company into highergrowth data- centric businesses,” said Angelo Zino, senior equity analyst with CFRA, in a note to investors.
Swan became CFO in 2016, and once held that position at eBay.
Intel shares fell 2.38 percent to close at $52.19 Thursday.