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Intel CEO Resigns After Employee Relationship Revealed

Dan Jones
6/21/2018

Intel's CEO, Brian Krzanich, has abruptly resigned over a relationship with an employee, the chipmaker said Thursday.

"Intel was recently informed that Mr. Krzanich had a past consensual relationship with an Intel employee," Intel Corp. (Nasdaq: INTC). said in a statement. "An ongoing investigation by internal and external counsel has confirmed a violation of Intel's non-fraternization policy, which applies to all managers."

The chipmaker's board has named CFO, Bob Swain, as interim CEO, effective immediately.

A longtime Intel employee, Krzanich became CEO in 2013. In recent years, he had developed a strategy to focus on the Internet of Things, 5G and the cloud, trying to move the processor maker beyond its PC roots. (See Intel to Lay Off 12%, Focus on IoT & Data Centers and Intel Kills Off Its Smartphone Chip Lines.)

Nonethless, Krzanich had spent a good deal of time putting out fires around Intel's PC and server chips in 2018, because of the global impact of the Spectre and Meltdown flaws, major security vulnerabilities discovered in its CPUs at the beginning of the year. (See Intel Shrugs Off Spectre Worries in Q4 and Intel: We've Patched Most Chips for 'Spectre' & 'Meltdown'.)

Intel investors are not happy about the surprise. Shares are down $0.82 (1.34%) to $52.67 this morning on the news.

— Dan Jones, Mobile Editor, Light Reading

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Joe Stanganelli
Joe Stanganelli
6/24/2018 | 10:46:12 PM
Corrections
Down less than 1.5% doesn't sound too bad -- and I suspect an upward correction will happen soon (provided no surprises in Swain's interim oversight and the new CEO selection). That upward correction could even skew higher than necessary (temporarily) if the new CEO choice is exciting.
kq4ym
kq4ym
7/9/2018 | 8:09:47 AM
Re: Corrections
It would be difficult to find is the news resulted in the stock movement, most likely it was just a normal blip in the often randomness of such things. Whether that or the myriad of other bits of the company will affect the price longterm remains to be seen of course.
Joe Stanganelli
Joe Stanganelli
7/9/2018 | 8:22:50 PM
Re: Corrections
@kq4ym: Fair point that correlation does not equal causation. It's worth noting, however, that we're talking more than 1.5%; Intel's stock continued a general slide for about week.

Since then, it has been on the upswing and has almost regained its value as of 6/21.

OTOH, the stock had been trending downward for two weeks preceding the announcement. (Coincidence, or tipoffs and light insider trading?)
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