Ousted Intel CEO Pat Gelsinger Leaves the Company with Millions

By Evans Momodu
3 minute read


Intel has parted ways with CEO Pat Gelsinger, leaving him with a significant severance package despite a challenging tenure that saw the company's stock value plummet by over 60%.

Gelsinger’s exit package includes cash payouts, bonuses, and stock holdings that could total over $24.5 million, according to regulatory filings. Here's a breakdown of the details:

Severance Breakdown

1. Base Salary: Gelsinger will receive 18 months of his $1.25 million annual salary, amounting to $1.875 million.
2. Performance Bonus: He is set to earn 1.5 times his target bonus of 275% of his base salary, equating to $3.4 million, paid over 18 months.
3. Pro-Rated 2024 Bonus: He is eligible for 11/12ths of his 2024 bonus, as his resignation came on December 1. The amount is yet to be disclosed but is a significant addition to his compensation.
4. Stock Holdings: Gelsinger owns approximately 646,000 Intel shares, valued at $14.5 million based on current market prices.

Context of His Departure

• Struggles Under His Leadership:
  • Intel’s stock fell more than 60% during Gelsinger's tenure, reflecting its inability to capitalise on the AI boom, which greatly benefited competitors like Nvidia and AMD.
  • Production delays and increased competition caused the company to lose market share and talent.
  • Despite billions in U.S. government funding aimed at boosting domestic chip manufacturing, Intel struggled to regain its former dominance in the semiconductor industry.
• Layoffs and Cost-cutting:
  • In August, Intel announced a 15% workforce reduction as part of a plan to cut $10 billion in expenses.

Gelsinger took the helm in February 2021, inheriting a company in a precarious position. As a former Intel CTO and VMware CEO, he returned with plans to restore the company’s technological and market leadership.

However, his efforts were hampered by production setbacks, strategic missteps, and fierce competition in the semiconductor market.

Intel now faces the challenge of finding a new leader who can navigate the turbulent semiconductor landscape.

The company must innovate to remain competitive in areas like AI and advanced chip manufacturing, even as rivals continue to widen the gap.

While Gelsinger’s tenure will likely be remembered as a difficult chapter in Intel’s history, his compensation underscores the high stakes and immense pressures at the helm of major tech companies.
Source: CNN