Are Intel’s problems too big to fix?

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Subscribe to enjoy similar stories. Pat Gelsinger’s quest to save Intel has come to an abrupt end. Whoever runs the storied chip maker next is still going to have to pull off a heroic feat.

Intel announced Monday that Gelsinger is retiring as chief executive and stepping down from the board of directors. The move had the tone of a peaceful transition, but the reality was still clear, with Gelsinger calling the day “bittersweet" and board chair Frank Yeary noting the goal of “restoring investor confidence" in the press release. Intel’s stock lost 61% of its value between Gelsinger’s first day on the job in early 2021 and Friday’s close, making it the worst performer on the PHLX Semiconductor Index over that time, according to data from S&P Global Market Intelligence.

The S&P 500 has gained 53% over the same period. A CEO exit following such an uninspiring run naturally sparks some hope; Intel’s shares jumped more than 5% Monday morning before ending the day with a slight loss. But the move raises even more questions about the company’s path, both in the short and the long run.

Current financial chief David Zinsner and Michelle Johnston Holthaus, who has been running Intel’s PC chip business, will act as co-CEOs while the board seeks a permanent replacement. That keeps the top job in limbo as Intel supposedly is nearing the end of its ambitious race to catch up its manufacturing processes with chip-making giant Taiwan Semiconductor Manufacturing. The culmination of that race is a production process called Intel 18A.

Intel said on its last earnings call on Oct. 31 that the first chips manufactured on that process are expected to start shipping in the middle of next year. Much rides on their success as 18A is the final phase