Departing Intel CEO Gets $10 Million

By Douglas A. McIntyre Published Dec 4, 8:15AM EST

Follow 24/7 Wall St. on Google

This post may contain links from our sponsors and affiliates, and Flywheel Publishing may receive compensation for actions taken through them.

Departing Intel CEO Gets $10 Million — © Alex Wong / Getty Images News via Getty Images

This post may contain links from our sponsors and affiliates, and Flywheel Publishing may receive compensation for actions taken through them.

Key Points

The CEO who nearly ruined Intel Corp. (NASDAQ: INTC | INTC Price Prediction) will receive $10 million or more as he walks away.
The question now is whether it is too late to save the semiconductor maker.
Take this quiz to see if you’re on track to retire. (sponsored)

According to a filing with the U.S. Securities and Exchange Commission, former Intel Corp. (NASDAQ: INTC) CEO Pat Gelsinger will receive between $10 million and $12 million upon his departure. The 8-K described the deal as a “separation agreement.” This award is impressive because he nearly ruined Intel, but it honors the terms of his employment package.

Why He’s Out

Can Intel be turned around?

Gelsinger became Intel’s chief executive officer on February 15, 2021. The stock traded at $62 a share then. Its current price is $22.50. In that time, its market cap has gone from $400 billion to $100 billion.

While the reasons for Intel’s fall are complex, the core issue can be summed up in one sentence: Gelsinger did not see what became a tremendous demand for artificial intelligence (AI) chips. Intel stayed with what made it successful for almost two decades, providing chips for personal computers and servers. Investors watched AI chip leader Nvidia’s revenue, earnings, and stock price soar.

Gelsinger’s predecessor, Bob Swan, was partially to blame for Intel’s lack of a position in the AI future. In 2018, he had a chance to invest in OpenAI but decided not to. Nevertheless, the decision about AI chips eventually took its toll on earnings and the stock price.

Gelsinger made several strategic decisions early this year to improve Intel’s fortunes. One was to lay off 17,500 people. The other was to invest $100 billion in new factories in four states. Federal grants to help the U.S. chip industry provided much of the capital. It was too little, too late.

Intel’s board probably began considering who the company’s new CEO should be after its most recent earnings report. Revenue dropped 6% to $13.3 billion. The company posted a $3.88 per share loss, compared to $0.07 in the same period the year before.

The board’s challenge is whether Intel can be turned around at all.

Nvidia Price Prediction and Forecast

About the Author Douglas A. McIntyre →

Douglas A. McIntyre is the co-founder, chief executive officer and editor in chief of 24/7 Wall St. and 24/7 Tempo. He has held these jobs since 2006.

McIntyre has written thousands of articles for 24/7 Wall St. He is an expert on corporate finance, the automotive industry, media companies and international finance. He has edited articles on national demographics, sports, personal income and travel.

His work has been quoted or mentioned in The New York Times, The Wall Street Journal, Los Angeles Times, The Washington Post, NBC News, Time, The New Yorker, HuffPost USA Today, Business Insider, Yahoo, AOL, MarketWatch, The Atlantic, Bloomberg, New York Post, Chicago Tribune, Forbes, The Guardian and many other major publications. McIntyre has been a guest on CNBC, the BBC and television and radio stations across the country.

A magna cum laude graduate of Harvard College, McIntyre also was president of The Harvard Advocate. Founded in 1866, the Advocate is the oldest college publication in the United States.

TheStreet.com, Comps.com and Edgar Online are some of the public companies for which McIntyre served on the board of directors. He was a Vicinity Corporation board member when the company was sold to Microsoft in 2002. He served on the audit committees of some of these companies.

McIntyre has been the CEO of FutureSource, a provider of trading terminals and news to commodities and futures traders. He was president of Switchboard, the online phone directory company. He served as chairman and CEO of On2 Technologies, the video compression company that provided video compression software for Adobe’s Flash. Google bought On2 in 2009.