Was Intel CEO Pat Gelsinger forced out of the company?

Intel’s CEO Pat Gelsinger, who had embarked on an ambitious mission to restore the company’s dominance in Silicon Valley, is officially stepping down less than four years after taking the top post. While the tech company’s announcement framed it as a retirement, reports from reputable news outlets presented a different narrative — that the board of directors forced Gelsinger out.

Gelsinger can be considered a lifelong Intel veteran, having worked for the company from 1979 to 2009 before returning in 2021 to lead the struggling chipmaker. By accepting the CEO role, he was well aware that the ultimate goal was to reverse Intel’s years of stagnation. This led him to come up with a four-year plan aimed at reestablishing the brand as a leader in the semiconductor manufacturing industry.

Over the past decade, Intel has grappled with significant challenges that made it lose its crown as a global leader in the microprocessing industry. Apart from missing the smartphone revolution by losing major clients like Apple to alternative processors and suffering persistent quality control issues with its main line products, the company failed to gain a footing in the artificial intelligence (AI) industry and now falls behind Nvidia in the AI chip market, according to The Verge.

It is important to note that Intel’s troubles go beyond business. The U.S. government considers the company a critical player in reducing reliance on Asian chip manufacturers, particularly Taiwan’s TSMC, amid geopolitical tensions with China. However, Gelsinger’s high-stakes efforts to revive the American company’s foundry business and reclaim market leadership have been costly and slow to materialize.

Gelsinger’s tenure was mostly marked by bold promises. He announced a plan to achieve “five nodes in four years,” a revolutionary goal to shrink transistor sizes across five product generations by 2025 — basically during his term as CEO. Intel also committed tens of billions of dollars to build state-of-the-art factories in the U.S. and reposition itself as a chip manufacturer for other companies.

However, the costs were staggering. Intel’s stock price halved during Gelsinger’s reign, and layoffs had become quite too common for a company that was gearing up to regain its dominance in the market. Just this past August, Intel announced it would lay off 15,000 employees and cease all nonessential work, and this reportedly affected the workforce’s morale. “The mental toll of that makes people put in the bare minimum, become apathetic, and ultimately go elsewhere,” a former employee confessed to The Verge‘s Sean Hollister.

Despite Gelsinger’s efforts, Intel’s financial performance got worse. The company posted a record $16.6 billion loss in Q3 2024, largely due to restructuring costs, following losses of $437 million in Q1 and $1.6 billion in Q2. Analysts and investors grew skeptical, particularly as the company faced increasing competition and missed opportunities in AI. Seeing all of these play out in less than a year, the board reportedly lost patience as progress in Gelsinger’s “ambitious turnaround strategy” and took measures for his ouster, according to Slashdot.

Gelsinger’s departure now leaves Intel at a crossroads. His ambitious plans to regain technological leadership by 2025 remain incomplete, and no successor has been named. The once-revered company now confronts not only its internal challenges, but also heightened public and investor scrutiny. Lawsuits over past projections, declining revenues, and mounting geopolitical stakes will likely force Intel to find a new path forward, and do it fast.