Intel CEO Brian Krzanich resigns

[Daniel Nenni]

Intel CEO Brian Krzanich reView attachment 21854signs due to violating the company’s non-fraternization policy with a consensual relationship with an employee.

SANTA CLARA, Calif.--(BUSINESS WIRE)-- Intel Corporation today announced the resignation of Brian Krzanich as CEO and a member of the Board of Directors. The Board has named Chief Financial Officer Robert Swan Interim Chief Executive Officer, effective immediately.

Intel was recently informed that Mr. Krzanich had a past consensual relationship with an Intel employee. An ongoing investigation by internal and external counsel has confirmed a violation of Intel’s non-fraternization policy, which applies to all managers. Given the expectation that all employees will respect Intel’s values and adhere to the company’s code of conduct, the Board has accepted Mr. Krzanich’s resignation.

“The Board believes strongly in Intel’s strategy and we are confident in Bob Swan’s ability to lead the company as we conduct a robust search for our next CEO. Bob has been instrumental to the development and execution of Intel’s strategy, and we know the company will continue to smoothly execute. We appreciate Brian’s many contributions to Intel,” said Intel Chairman Andy Bryant.


Intel CEO Brian Krzanich Resigns; Board Appoints Bob Swan as Interim CEO

 

[coldsolder215]

I suppose resigning for consensually diddling a subordinate is still more preferable than owning the demise of a once great American technology firm.

 

[Chipper]

Yup; the new version of "spending time with your family", only which family?

 

[Daniel Nenni]

And no mention of what happened to the consensual subordinate? I'm sure there is more to this story and it will come out at some point in time. Maybe it is related to his big stock sell because this "relationship" may be expensive. Hopefully Intel hires an outsider. Sanjay Jha is available. I know he was considered last time.

 

[count]

I'll bet this will end up like GE, where the house of cards will fall down as all the largess is exposed under new management.

 

[hist78]

And no mention of what happened to the consensual subordinate? I'm sure there is more to this story and it will come out at some point in time. Maybe it is related to his big stock sell because this "relationship" may be expensive. Hopefully Intel hires an outsider. Sanjay Jha is available. I know he was considered last time.

I just feel there are holes in the whole story. Not because his behavior but because when this romance happened.

 

[Portland]

Affairs happen, people work long hours together and stuff happens. I think that probably what happened than him being a predator.

Should of gone with perlmutter. Let's be honest if the decision was today it would of been permutter, he was the most qualified.

 

[benb]

My prediction is, this happened to avoid a MeToo for Intel and the new CEO will be a woman. Stocks still above 50, investors will miss BK even if this board doesn’t.

 

[count]

I just feel there are holes in the whole story. Not because his behavior but because when this romance happened.

IMO it was a forced resignation. ie. BK is voluntarily leaving because of this nonsensical reason we dug up, not because our company is on the verge of imploding and can only hide it for a couple more quarters.

 

[lilo777]

IMO it was a forced resignation. ie. BK is voluntarily leaving because of this nonsensical reason we dug up, not because our company is on the verge of imploding and can only hide it for a couple more quarters.

You must know something others don't. Intel just raised its guidance for the second quarter[FONT=&quot]. [/FONT]

 

[Chipper]

Yes but if you listen to their last conference call, INTC management was oddly optimistic about the first half and oddly pessimistic about "visibility" beyond. So it sounds like a Meltdown remediation surge as customers race to consider alternative chips, many of which will be custom devices made using TSM fabs. Don't forget the $500M surge in new design related products, mask making as I recall.

 

[count]

You must know something others don't. Intel just raised its guidance for the second quarter.

What I know isn't something that others don't. 10nm has big problems while foundry 7nm is off to the races. The company hasn't had a successful major product launch on time in years. They have turned to acquisitions to grow revenue and fill fabs that would otherwise be idle. They have overpayed as they chase new markets. They have turned to financial engineering to beat quarterly numbers. I could go on.

What other large companies that have fallen from grace (ie, GE and Enron) have shown is that these issues can be papered over years without being reflected in the stock price, but eventually the cockroaches will start coming out of the walls.

 

[Daniel Nenni]

My prediction is, this happened to avoid a MeToo for Intel and the new CEO will be a woman. Stocks still above 50, investors will miss BK even if this board doesn’t.

Certainly possible. I find it interesting that it is called a "consensual" relationship and not just a relationship. That is a big red flag for me. I also find it interesting that "Intel said that it found that Krzanich had a "past consensual relationship with an Intel employee" that ended up being a "violation" of company policies". This is the old Intel at work spinning things. Past as in before he was CEO? Did they not vet him prior to offering him the CEO position?

They had better hope that the He or She on the other end of the relationship doesn't hire Stormy Daniels lawyer (Michael Avenatti).

 

[hist78]

IMO it was a forced resignation. ie. BK is voluntarily leaving because of this nonsensical reason we dug up, not because our company is on the verge of imploding and can only hide it for a couple more quarters.

Quote form the news:
https://www.cnbc.com/2018/06/21/int...-down-bob-swan-to-step-in-as-interim-ceo.html

[FONT=&quot]Krzanich violated a policy that said managers cannot have relationships with people who report to them either directly or indirectly. The relationship ended and took place "some time back," people familiar with the situation told CNBC. It's unclear with whom Krzanich, 58, had the relationship.[/FONT]

[FONT=&quot]"some time back" ? [/FONT]Something must happen "recently" that forced the Intel's Board to react. Either they react strictly due to this code violation, or use this relationship as a cover for other serious issues/reasons.

 

[Portland]

It was either him or perlmutter at the time and intel wasn't going give it to perlmutter while Obama was president. If it was now and Trump being president it would be perlmutter.

Engineering is a sink or swim profession and Krzanich was sinking, that's why he's gone. I can believe that Andy Bryant threw Krzanich under the bus to save his ass for another 6 months.

My guess the struggle with 10nm is the automated equipment. Americans like frakenstein machines with parts from different companies. The process may had to be streamlined and that that would take a lot of work.

 

[Daniel Nenni]

It was either him or perlmutter at the time and intel wasn't going give it to perlmutter while Obama was president. If it was now and Trump being president it would be perlmutter.

Engineering is a sink or swim profession and Krzanich was sinking, that's why he's gone. I can believe that Andy Bryant threw Krzanich under the bus to save his ass for another 6 months.

My guess the struggle with 10nm is the automated equipment. Americans like frakenstein machines with parts from different companies. The process may had to be streamlined and that that would take a lot of work.

Good point. Bryant is the one who hired BK, why is he not gone? Another question, why didn't BK just go quietly? Why the big PR show? This whole thing does not pass the sniff test. It really is a pile of manure.

 

[hist78]

Good point. Bryant is the one who hired BK, why is he not gone? Another question, why didn't BK just go quietly? Why the big PR show? This whole thing does not pass the sniff test. It really is a pile of manure.

If you look into the composition of the Board of Directors of Intel and TSMC, you probably will see a very different picture and culture. Will that lead to very different leadership styles, strategy and technology selections, and the final outcomes?

Some observations:

1. There are nine members in each company's board.

2. Intel's board is heavily "non-engineer" while TSMC is totally opposite.

3. Intel's board has only two members hold advanced degree (master or PhD) in engineering. TSMC on the other hand has six members hold master or PhD. degrees in Engineering (I don't count honorable degree).

4. Intel's board members are strictly from US domestic while TSMC has three members come from USA and Europe (England). In today's economy, TSMC's board member's selection reflects more of the "international" thinking.

5. Among those nine TSMC's board members, there are several semiconductor/IT industry heavyweight.
Stan Shih is the co-founder and Chairman Emeritus of the Acer Group.
Sir Peter L. Bonfield is the former Chairman and CEO of British Telecommunications and currently the Chairman of the Board of Directors of NXP.
Thomas J. Engibous is the former Chairman, President and Chief Executive Officer of Texas Instruments
Michael R. Splinter is the former of Chairman and Chief Executive Officer of Applied Materials.

6. Intel's board members' experience are very different from TSMC's. Intel's board are full of people (six out of nine ) from finance and investment background. This is fine if Intel Chairman Andy Bryant wants to transform Intel into a investment and holding company. Otherwise, it doesn't make too much sense.


Board of Directors of Intel
Board of Directors | Intel Newsroom

Board of Directors of TSMC
Taiwan Semiconductor Manufacturing Company Limited

 

[lilo777]

If you look into the composition of the Board of Directors of Intel and TSMC, you probably will see a very different picture and culture. Will that lead to very different leadership styles, strategy and technology selections, and the final outcomes?

Some observations:

1. There are nine members in each company's board.

2. Intel's board is heavily "non-engineer" while TSMC is totally opposite.

3. Intel's board has only two members hold advanced degree (master or PhD) in engineering. TSMC on the other hand has six members hold master or PhD. degrees in Engineering (I don't count honorable degree).

4. Intel's board members are strictly from US domestic while TSMC has three members come from USA and Europe (England). In today's economy, TSMC's board member's selection reflects more of the "international" thinking.

5. Among those nine TSMC's board members, there are several semiconductor/IT industry heavyweight.
Stan Shih is the co-founder and Chairman Emeritus of the Acer Group.
Sir Peter L. Bonfield is the former Chairman and CEO of British Telecommunications and currently the Chairman of the Board of Directors of NXP.
Thomas J. Engibous is the former Chairman, President and Chief Executive Office of Texas Instruments
Michael R. Splinter is the former of Chairman and Chief Executive Office of Applied Materials.

6. Intel's board members' experience are very different from TSMC's. Intel's board are full of people (six out of nine ) from finance and investment background. This is fine if Intel Chairman Andy Bryant wants to transform Intel into a investment and holding company. Otherwise, it doesn't make too much sense.


Board of Directors of Intel
Board of Directors | Intel Newsroom

Board of Directors of TSMC
Taiwan Semiconductor Manufacturing Company Limited

It's the difference between USA and Taiwan. Just go check Apple board of directors. In US, boards of directors are just rubber stampers.

 

[Daniel Nenni]

Looking back I think the Intel Contra Revenue scheme to get into mobile was one of the worst things to happen under BK. Here are a couple of threads which discuss it in detail. My guess is that Intel lost 10s of billions of dollars onmobile including the acquisitions, contra revenue, and other expenses:

Intel Contra Revenue

Intel still losing billions in contra revenue

Second is probably 10nm? But BK was fired for a consensual relationship.... Hahahaha...

 

[count]

Looking back I think the Intel Contra Revenue scheme to get into mobile was one of the worst things to happen under BK. Here are a couple of threads which discuss it in detail. My guess is that Intel lots 10s of billions of dollars onmobile including the acquisitions, contra revenue, and other expenses:

Intel Contra Revenue

Intel still losing billions in contra revenue

Second is probably 10nm? But BK was fired for a consensual relationship.... Hahahaha...

As I noted in a previous thread:

Lets all take a moment to remember that BK came from the manufacturing side and became CEO by selling the board on a vision for using Intel's

manufacturing advantage to win mobile.

Intel Names Brian Krzanich as Chief Executive - The New York Times

So I'd guess it was both mobile and failure at 10nm. Intel's vision and strategy under BK, according to BK, was to use Intel's manufacturing advantage to win in new markets. With the manufacturing advantage gone, we can say with certainty that the strategy that BK had sold the board on failed, in spite of the fact that Intel did manage to increase share price and profits via financial engineering. Financial engineering is not a sustainable way to run a company in the long term, and Intel may be running out of room on that front.