This morning Intel released a formal press release stating that Brian Krzanich, now former CEO, had resigned. Current CFO Robert Swan has been named the interim CEO while the company looks for a replacement.

As Intel does not have an immediate replacement, the resignation seems to be a snap decision relating to what Intel calls ‘a past consensual relationship with an Intel employee’ (believed to be a direct subordinate), and an expectation that employees adhere to a code of conduct regarding relationships.

Sources have told CNBC that 'Krzanich violated a policy that said he could not have a relationship with an employee who directly reported to him. The relationship ended and took place "some time back," the people said. It's unclear with whom Krzanich had the relationship. The company was only recently made aware of the relationship, at which point they began probing and Krzanich was asked to resign'. 

Intel’s Board of Directors accepted Krzanich’s resignation and it was formally announced this morning. Krzanich has also departed the Board of Directors as well.

Robert Swan, Intel’s Chief Financial Officer, will sit in the CEO seat effective immediately while a search has begun for a replacement for Krzanich. Swan’s credentials include nine years at eBay, and also time at Electronic Data Systems Corp, both positions held as CFO.

Intel's Chairman of the Board, Andy Bryant, said in a statement:

"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."

Krzanich joined Intel in 1982 as a process engineer in one of the company's fabs in New Mexico, before coming manager of the plant, and rising through the system to COO in 2012 and CEO in May 2013. Under Krzanich’s leadership, Intel has diversified its product portfolio into new areas, such as FPGAs, IoT, Mobile, Wireless, autonomous vehicles, networking, 3D XPoint memory, and saw the company through successive generations of new processors, aiming to turn the company from a PC-centric business to a data-centric business (to use Intel's own terms). Key points along the way have been the drive for conflict-free materials, as well as diversity initiatives, with recent investment into other areas such as eSports.

As a result, Intel recently posted its best quarterly financial reports ever, and the stock and value of the company continues to grow, leading to an overall 120% growth since 2013. Counter to this, Krzanich has also had to steer the company through the current issues surrounding their next generation 10nm process technology, which is was expected to be an integral part of the company portfolio last year, but is facing further delays. Also in recent months the announcements regarding Spectre and Meltdown vulnerabilities have also become public. Krzanich's page on Intel's website is no longer present.

CNBC reports that in 2017, Krzanich's total compensation topped $21m.

Intel states that ‘the board has a robust succession planning process in place and has begun a search for a permanent CEO, including both internal and external candidates’. Initial feelings from analysts suggest that internal candidates such as Dr Murthy Renduchintala might be in the running for the top spot.

Intel's press release is as follows:

SANTA CLARA, Calif. – June 21, 2018 – 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 expects to deliver a record second quarter, with revenues of approximately $16.9 billion and non-GAAP EPS of approximately $0.99. With accelerating data-centric revenue, the company is off to an excellent start in the first half of the year and expects 2018 to be another record year. Intel will provide full second-quarter results and an updated outlook for the full year on the second-quarter earnings call on July 26.

As interim CEO, Swan will manage operations in close collaboration with Intel’s senior leadership team. Swan has been Intel’s CFO since October 2016 and leads the global finance, IT and corporate strategy organizations. He previously spent nine years as CFO of eBay Inc. Earlier, he was CFO of Electronic Data Systems Corp. and TRW Inc. He has also served as CEO of Webvan Group Inc.

Swan added, “Intel’s transformation to a data-centric company is well under way and our team is producing great products, excellent growth and outstanding financial results. I look forward to Intel continuing to win in the marketplace.”

The board has a robust succession planning process in place and has begun a search for a permanent CEO, including both internal and external candidates. The board will retain a leading executive search firm to assist in the process.

Source: Intel

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  • close - Tuesday, June 26, 2018 - link

    @designerfx: Um... Do you have a deposition from any witness that nobody else has? Are you claiming to be the woman in that relationship? Because absent that and since every single news source called in "consensual" saying anything else is just you promoting your own agenda. That's an euphemism for "bullshit". How about you wait for some evidence?

    And no, consent definitely cannot change after the fact. Do you even know what the word means and how the concept works? It can change before the fact, it can even change after the fact, it definitely NOT change after the fact. How would that even work?

    Given you "flexible" understanding of English vocabulary I wonder how qualified you are to have any kind of opinion, let alone on complex topics. That's an euphemism for... ;)
    Reply
  • close - Tuesday, June 26, 2018 - link

    P.S. @designerfx, while evidence might turn up showing the relationship was not consensual the point still stands: consent cannot be changed AFTER THE FACT. The relationship IS "the fact". And once ended nobody can "reconsider" the initial consent and realize "I actually didn't want that". Reply
  • peevee - Tuesday, June 26, 2018 - link

    "There is only approximately one person who says it's consensual and that's the CEO"

    Or you can learn to read and count...
    Reply
  • camastersgt - Tuesday, June 26, 2018 - link

    wow dude, get a clue. How wonderful that you can think, but your reasoning lacks depth. Please don't work in HR for any company, you are a mess.

    This issue isn't concerned with consensual or nonconsensual. Nobody even cares if it is legal, it is still wrong because it can affect the perception that there was "quid pro quo" going on. You know the term..."this for that". This situation is also similar to Bill Clinton and Monica Lewinski. Power and authority over a subordinate. In this case it violates just plain old good sense and could be damaging to the careers of those that were not sleeping with him. Why was she getting ahead or that opportunity? A little bit of discrimination comes into play. Rape no...but always look further. Think strategically and masterfully. Take care now.
    Reply
  • close - Wednesday, June 27, 2018 - link

    @camastersgt: this is the kind of forum where if you don't reply to a name nobody knows who you're talking to.

    In case you were replying to me, whether it's consensual or not is relevant to the #metoo mention. People throw that hashtag around a lot without understanding what it means. It's a movement against sexual harassment and assault. Not a movement between what looks like could be quid pro quo but maybe isn't.

    Now I see plenty of people who somehow confuse the two due to very limited understanding of the topic and/or limited processing power.

    What Intel's CEO did is unethical and *COULD* be a conflict of interest. And yes, it could be damaging to careers.
    What #metoo means is basically rape. That damages a lot more than your career.

    See the difference and the relevance now? Because if anybody confuses these 2 they shouldn't work anywhere near people or be tasked with any decision of any kind :).
    Reply
  • FunBunny2 - Wednesday, June 27, 2018 - link

    @close:

    in among these comments, somewhere, is a reference to the UCMJ. go read up on it. it asserts that any fraternization between an officer and a subordinate is, by definition, a court martial offense. consensual isn't considered, since the power position makes it impossible. if it's OK for the military, why not for Capitalism?
    Reply
  • close - Thursday, June 28, 2018 - link

    @FunBunny2: not sure if serious or... "if it's OK for the military, why not for Capitalism?" o_O

    Why would I care about a reference to UCMJ? Why would I need to read up on it? Why would it matter how the military treats fraternization for this particular case? Why would the way the military treats it have any bearing on how civilian life treats it?

    That could very well be the stupidest thing I've heard in a loooong time. How about you go to prison for disobeying any "order" that comes from your superiors? Most likely your primary school teachers given the nature of your assessment.

    The military rejects you if you are over 27/29/34 years old, depending on the branch. Is that not good enough for "capitalism"? And I won't even go into the litany of medical conditions that prevent you from joining. Why not apply them in "capitalism"?
    You'll notice I use quotes on "capitalism". It's because I doubt you know what you mean when comparing "military" and "capitalism".

    Also the military doesn't accept you without a high school diploma or GED. "Capitalism" allows it so people can still post comments like yours. ;)
    Reply
  • peevee - Thursday, June 28, 2018 - link

    Unlike in the military, you are not forced by the law to follow your boss's orders. Reply
  • Dayman1225 - Thursday, June 21, 2018 - link

    Loss? My ass. 10nm delay after delay under him essentially hurting all of their core businesses, products cancelled or endlessly delayed under him. Intel was a shit show under BK I can only hope for someone better. Reply
  • Stuka87 - Thursday, June 21, 2018 - link

    Last I checked, the CEO isn't the one thats implementing and designing fabs and processes. I don't think the 10nm delay can be blamed on him at all. I think that falls on the engineers. Reply

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