Exclusive-Intel approaches candidates for CEO role, including former board member Lip-Bu Tan, sources say

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By Max A. Cherney and Milana Vinn

(Reuters) -Intel has started evaluating a handful of outsiders, including former board member Lip-Bu Tan, for the role of chief executive after the struggling American chipmaking icon ousted company veteran Pat Gelsinger, according to people familiar with the matter. 

Tan, a well-respected semiconductor industry veteran who has long been seen as a contender for CEO at Intel, has been approached by Intel’s board in recent days to gauge his interest in taking up the job, the sources said, requesting anonymity as the discussions are confidential.

Intel’s board is mostly evaluating outsider candidates for the role and has also approached Marvell Technology CEO Matt Murphy, two of the sources said.

The deliberations on the CEO succession are at an early stage, the sources said, cautioning that Intel has not yet zeroed in on any candidate to replace Gelsinger who stepped down from his role on Monday after being given the choice to retire or be removed.

The move to replace Gelsinger – who took charge of Intel less than four years ago – came after the board decided that the pace of his costly plan to turn around Intel’s fortunes was not quick enough.  

The board has formed a search committee for Gelsinger’s successor and is expected to make a final decision on his replacement in the coming months, the sources said. The company on Monday named Chief Financial Officer David Zinsner and senior executive Michelle Johnston Holthaus as interim co-CEOs.

Intel declined to comment. Representatives for Tan’s venture capital firm, Walden Catalyst, did not respond to a request for comment. On Marvell’s quarterly results call on Tuesday, Murphy said that as the chairman and CEO of the company he is “100% focused on Marvell.”  Bloomberg previously reported that Intel was considering Murphy for CEO.

HIGH-PROFILE CEO HUNT

The hunt for Intel’s next leader is one of the most closely-watched CEO successions in corporate America and comes at a pivotal time for the ailing chipmaker, which is enduring one of the bleakest periods in its five-decade history.

Gelsinger in 2021 inherited a company rife with challenges that he compounded. Setting lofty ambitions for manufacturing and AI capabilities among major clients, Intel ultimately lost or canceled contracts under Gelsinger’s watch, and was unable to deliver the promised goods, Reuters reported in October.

Intel’s revenue shriveled to $54 billion in 2023, down nearly one-third from the year Gelsinger took over. Analysts expect Intel to lose $3.68 billion this year, its first annual net loss since 1986. Its shares were down nearly 6% on Tuesday, off more than 60% from a peak hit in Gelsinger’s first months as CEO.

The crash in Intel’s share price has sparked takeover interest from suitors such as Qualcomm, Reuters has previously reported.

Murphy has served as CEO of Marvell since 2016. He previously worked at Maxim Integrated Products Inc, where he spent nearly 22 years in various roles.

Tan, the former CEO of chip-software company Cadence Design, joined Intel’s board two years ago as part of a plan to restore Intel’s place as the leading global chipmaker. The board expanded Tan’s responsibilities in October 2023, authorizing him to oversee manufacturing operations.

But Tan departed in August after clashing with Gelsinger on several aspects of Intel’s turnaround plan, including the size of the company’s workforce, its contract manufacturing strategy, and its work culture, Reuters has reported. 

(Reporting by Milana Vinn in New York and Max Cherney in San Francisco; editing by Kenneth Li, Anirban Sen and Nick Zieminski)