Intel CEO Otellini to retire in May 2013

Wow, what is it with high-profile tech executives leaving lately? On the heels of Scott Forstall‘s departure from Apple and Steven Sinofsky stepping down at Microsoft, Intel CEO Paul Otellini has announced that he, too, is going to be leaving his post.

In this case, Intel says Otellini “has decided to retire.” Otellini, who is 62 years old, states in the press release, “After almost four decades with the company and eight years as CEO, it’s time to move on and transfer Intel’s helm to a new generation of leadership.” Otellini goes on to say he’ll work with the board on a transition path over the next six months, after which he’ll remain “available as an advisor to management.”

No successor has been named yet. Intel says it plans to look at candidates both inside and outside the company. Perhaps in a related move, the chipmaker says three “senior leaders” have been promoted to executive VP: software chief Renee James, “director of corporate strategy” Stacy Smith, and COO and manufacturing chief Brian Krzanich.

It’s always hard to know what goes on behind closed doors in those big corporate conference rooms, but Otellini’s departure doesn’t seem like a forced move. In fact, the Wall Street Journal, which was tipped off by someone with knowledge of the situation, claims Otellini “surprised the board with his decision to retire.”

Otellini has certainly served Intel well. He’s steered the company from the dark days of the Pentium 4 to its current position of strength in the PC industry. ARM-based offerings remain a challenge to Intel’s leadership in the mobile space, but we finally saw the first Intel-powered smartphones debut earlier this year, and Intel’s earnings keep breaking record after record. As Intel says in today’s announcement, the company has generated over $100 billion in total cash while Otellini has been in charge.

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    • jimbo75
    • 7 years ago
      • chuckula
      • 7 years ago

      You’re totally right: When Dell adopted AMD chips it put a huge crunch on AMD’s ability to get product to market and screwed over smaller channel partners who had been loyal to AMD for years. Michael Dell helped to begin AMD’s downward spiral by buying up all the supply at a discount that could have been bought at full-price by smaller channel partners. If Paul Ottellini was involved in making decisions at Intel that made its chips less attractive to Dell to promote Dell’s move, then he’s obviously responsible too. Almost as much as Wrector “Look at me I’m on the cover of Forbes, who cares about bankruptcy when I have my Golden Parachute!” Ruinz.

    • holophrastic
    • 7 years ago

    I imagine that many are retiring now for one simple reason. The industry has completed its shift to the I’m-cheaper-than-you marketing scheme. For a CEO that made processors more powerful, more better, and more high-end than ever before (think extreme editions), the goal of shaving pennies and getting a price down to $1 per processor isn’t exciting. I’d agree.

    • NeelyCam
    • 7 years ago

    Where’s the speculation over the succession?

    In my opinion, it’s between Perlmutter (internal) and Gelsinger (external). I vote for Gelsinger

      • chuckula
      • 7 years ago

      The Gelsinger boat has sailed. He left because he knew that he would be passed over for the CEO position when the time came (it came a little earlier than expected though). I could see Perlmutter or another internal executive.

      It could be nice to have an outsider come in as CEO, but the issue there is that you *really* have to know the ins & outs of the semiconductor business to have this job. How many highly-qualified people from outside of Intel are free on the job market? I’m sure there are a few but I don’t know their names off the top of my head.

        • NeelyCam
        • 7 years ago

        Didn’t Gelsinger leave because Sean Maloney was ‘picked’? Sean Maloney is retiring now, so the door could again be open for Gelsinger

    • LocalCitizen
    • 7 years ago

    If there’s ever a suitable time for a CEO change at Intel, this is probably as good as ever.

    on x86, Haswell is on track and highly anticipated, and really, there’s no competition. on ARM, it’s not yet ready to topple Intel. the new ceo guy would have time to adjust and try a few things. hey, Intel can take a nap and still be able to catch up.

    just an opinion on the Atom, it’s probably the most disappointing Intel chip (Xeon Phi to be seen). then again, it’s not all that surprising. it’s been crippled left right and center in order not to sabotage the Core chip sales. but let me tell you the story of Kodak. it was the earliest with digital sensors and cameras. but because it doesn’t want to disrupt its lucrative film business, it never invested as much to develop digital technology. instead, canon and sony jumped at the chance, and toppled Kodak.

    Moral of the story, Intel, if new technology comes that could destroy your core business (pun intended), don’t be afraid to jump on it with full force. because if you don’t others will.

      • MadManOriginal
      • 7 years ago

      Atom is moving from a 5-year architecture cadence, which made sense for its goals in 2007 when it was introduced, to a 2-year architecture ‘tick-tock’-like cadence. Now that they are near having everything integrated SoC-style they can focus on architectural improvements. I think Intel has seen the changes since Atom’s introduction and has adjusted without entirely disrupting their roadmaps…changing direction in a useful manner – meaning not just slapping it on a roadmap slide and saying HEY GUYZ, THIS IS WHAT WE’RE DOING INSTEAD! AMD-style – doesn’t happen overnight.

      Alternatively, they may just expand the power envelope of their mainstream x86 cores. Could a sub-1W post-Haswell SoC replace Atom? Maybe!

      • yogibbear
      • 7 years ago

      You missed the bit where Fujifilm beat Kodak because Kodak wanted photos that were ‘realistic’ whereas Fujifilm wanted photos that had more ‘colour pop!’… average joe preferred colour pop over realistic reproduction.

        • jihadjoe
        • 7 years ago

        Any idea how accurate color vs color pop relates to faster cores vs more cores?

    • jihadjoe
    • 7 years ago

    AMD should try hiring him.

      • jimbo75
      • 7 years ago
    • UberGerbil
    • 7 years ago

    This is very different from the Forstall and Sinofsky departures. If it was like them, he’d already be cleaning out his desk. A six month timeframe is consistent with a graceful, mutually-accepted termination of employment. As you say, it’s hard to know without inside knowledge, but none of the facts available suggest it is a forced move. And he certainly seems to be leaving on top.

    Well-run companies realize there’s a risk to keeping the same guy at the top for too long, and not just in the obvious ways like the ossification of decision-making and failure to explore new ideas (or re-explore old ideas that were rejected when conditions were different). You also have a problem of imposing a ceiling on the aggressive, ambitious junior managers who should be leading your company years from now. If they see the conveyor-belt to the executive suite stalled, they’ll move on to other companies (or found their own), and you’ll lose exactly the kind of people you want to retain — and the ones you want the most will be the ones who jump first. This is almost certainly one of Microsoft’s problems, and avoiding it is why the US military has strong rules about how long its generals can occupy its top jobs.

      • Flying Fox
      • 7 years ago

      Only this time the timing seems to be a bit too early for the Board. Normally Intel would have promoted potential successors first, then after the selection process the heir-apparent may go to the COO post first to learn the ropes of day-to-day operations. This may indeed take the board by surprise, but then again 8 years at the helm may be long enough so in the end it makes sense.

      Intel usually has a pretty thorough succession planning, so this seems a bit out of them. However it should be just a little blip vs an earthquake.

        • ludi
        • 7 years ago

        Could even be some undisclosed health issues.

          • NeelyCam
          • 7 years ago

          I was wondering about that.. Why else the “surprise”?

        • paulWTAMU
        • 7 years ago

        if you can’t find and get a replacement up to some decent level of competency in six months, your succession plan needs work.

          • ludi
          • 7 years ago

          I don’t think it’s that, I think it’s that investors don’t like surprises. When they get surprised, they start asking the sorts of questions we’re asking, and the uncertainty then affects market perceptions of the company.

          Usually these things are orchestrated from about a year in advance, with the board being the first to hear, and then they decide when and how to release that information to the public — usually after they already have a viable candidate pool vetted.

          • Flying Fox
          • 7 years ago

          I have not heard much about Brian Krzanich (the current COO) being groomed to be CEO, and for Craig Barrett and Otellini they spent years as COO learning the ropes for day-to-day operations before getting the CEO job. At the very least if they have some internal candidate in mind that person would have been voted into the Board of Directors already. That’s why I said this seems a bit early.

          That’s not to say the successor cannot learn on the job. With Intel’s size there is a lot of pick up on though.

    • dpaus
    • 7 years ago

    [quote<] Scott Forstall, Steven Sinofsky, Paul Otellini....[/quote<] I bet they're going to pool their 401Ks, buy AMD, license Open WebOS, contract Samsung and shape the future of the post-PC era!

      • anotherengineer
      • 7 years ago

      Pool??

      If these guy invested their millions properly, any one of them could probably cut a cheque for AMD with it’s current stock price.

      • DeadOfKnight
      • 7 years ago

      What a horrible investment strategy.

      • chuckula
      • 7 years ago

      And here I thought they were going to get a hippy-van and go to random places to solve mysteries with a dog.

    • Deanjo
    • 7 years ago

    [sarcasm] Obviously this is a forced retirement from the mounting pressure that intel products are facing from AMD. [/sarcasm]

      • chuckula
      • 7 years ago

      Watch out! AMD will soon improve its PPPS (performance promises per slide) by 50% in upcoming presentations!

        • Deanjo
        • 7 years ago

        How can you improve something that is already industry leading by a large margin?

          • NeelyCam
          • 7 years ago

          I see what you did there..

      • Arclight
      • 7 years ago

      In a statement made yesterday, a top AMD exec. said quote We got so far ahead of our competitors that we won’t have to improve our x86 architecture ever. unquote.

      Edit

      OK i admit, it wasn’t funny because but it’s the truth, they want to scrap all the future high end chips.

    • jdaven
    • 7 years ago

    In a small company like AMD, they can fire their CEO (Dirk Meyer) when there is a difference in opinion of company strategy. In a large company like Intel, the CEO has to ‘retire’ when there is a difference of opinion and the board wants him/her out. This is probably to save face.

    The question is, What was the difference in opinion?

      • chuckula
      • 7 years ago

      [quote<]In a small company like AMD[/quote<] AMD's board & management are 100% responsible for AMD being the "small" company that it is today. Also, if you think that sudden departures can't happen at Intel, look no further than Pat Gelsinger. If the board couldn't stand Otellini then he wouldn't be hanging around for another 6 months and still being and advisor after that.

      • Sargent Duck
      • 7 years ago

      Orrrrrrrr…..He really does want to retire and spend some time with his grandchildren*…

      *Just guessing he has grandchildren

        • dpaus
        • 7 years ago

        [quote<]guessing he has grandchildren[/quote<] I think he has lower-spec'd chips off the old block.

          • CuttinHobo
          • 7 years ago

          Those small mobile devices have great battery life, too, especially considering how loud their speakers are. They can just run, run, run all day long. Unfortunately they get a little ornery once their battery gets low, and finding the charging port can be a challenge at times.

      • derFunkenstein
      • 7 years ago

      And sometimes, old people just want to quit working.

        • travbrad
        • 7 years ago

        Yeah I imagine most people would retire if they had the kind of money he has, and probably a lot earlier than age 62 if they could.

      • JumpingJack
      • 7 years ago

      Odd, don’t you think that they fire him, yet let him hang around until May???

      • Meadows
      • 7 years ago

      As others have (more gracefully) wondered, what special flavour of moron are you exactly?

    • jjj
    • 7 years ago

    What the board leaks to the press doesn’t have to be true.Anyway,it was time for him to leave,he did ok while the PC industry was still growing but now Intel needs to transform to stay relevant (long term) and that requires taking a few risks. That’s a lot easier to do for a newcomer. At least now there is hope that Intel won’t just stand still to become a… Kodak moment.

      • Ringofett
      • 7 years ago

      I see it as the triumphant general retiring while he’s on top the world. Don’t see how Intel is standing still at all; Xeon Phi (I agree with S|A) might dominate, and I still can’t quite make myself believe Haswell will truly be high performance and consume only 10 watts. That makes it sufficiently low-power to ensure ARM stays out of any desktop or laptop that needs actual performance of any kind. They also joined the SSD party, since it makes use of their manufacturing prowess so nicely. Their next-gen Atom stuff looks interesting, too.

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