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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  • BurntMyBacon - Friday, June 22, 2018 - link

    Yes, it is a problem with their 10nm manufacturing node. However, the problem is still a technical problem (defect rates, exposure times, doping levels, number of masks, wavelength used, etc.) and not a manufacturing problem (supply chain logistics, production ramp up, time to delivery, automation, etc.). His background does not make him better suited to this type of problem. Not directly anyways. Reply
  • saikrishnav - Thursday, June 21, 2018 - link

    More like Huge exaggeration. I wouldn't say "any CEO", but they should be able to easily find a better person. After selling shares before vulnerability reveals and a messy X299 launch, Intel deserves a better leader. Reply
  • brunis.dk - Friday, June 22, 2018 - link

    Hugh Loss is coming to Intel? Cool! Reply
  • JKflipflop98 - Sunday, June 24, 2018 - link

    . . . are you joking? He's the worst CEO we've ever had. Reply
  • mark_nano - Tuesday, June 26, 2018 - link

    you have no idead to te veracity of the No One Better at What Brian did / does. I worked with him at Cray Research in Eau Claire Wisconsin on the Cray 3 Gallium Arsenide process used by Seymour Cray himself. Brian quickly IDd process and equipment problems and fies lickety split. So much so he invented without patent filing the most effective means to do (gold) Liftoff Patterning as if from thin air. No examples of the method he used / developed in the literature, not even hints. He prototyped on a tiny chemical wet bench a 1st 3inch GaAs wafer, the hulking genius sitting on a tiny lab stool with a teflon wafer dipper in the novel liftoff patterning chemistry. Stays in my head what transpired, no one in process engineering comes close not even by light years. He also wiped into shape a POS Perkin Elmer Censor optical wafer stepper camera in a few weeks where it never worked before ( as if magic ). This merely hinted at his amazing skill. His effort to get Intel's 1st (and world's 1st) 6inch wafer fab working was way huger a task but reflected on Brian's Extraordinary Skill ( and I have worked with many brilliant process engineers - he towered above all I had met prior and later in my career ). The importance of Process Engineering Skill to bleeding edge Wafer Fabrication Businesses is not to be underestimated. When Brian Delayed volume production ramps ( as with ?5-7nm using EUV / Xray Lithography ) he had experience and wisdom of when just ready ( or not yet ). Too early a production ramp on a novel process and one burns cash from Low-(est) Yields. Intel is an early adopter of EUV ( equip purchased and installed process ramp is taking time as the resist is entirely new an inorganic Metal / Oide system )

    While Swam might be good with numbers and investors, he is a babe in the woods for operations and Technology of core intel Businesses ( not unintelligent but the stuff involved is WAAY over his head )

    I am guessing 2 folks useful here might be Rene James ( software centric ? CPU design managment / product mgmt ) and Intel's retired Mooly Eden both who might have their reasons to not return,

    Best of All woudl be to call Brian Back honorably as he is one of a kind in the whole world PERIOD.

    He should have been given a 1 strike warning for the "consensual relationiship" and not told to leave ( others want his job, DUMB business motivation given his extraordinary skills on manny fronts ) He manages execution of projects and people effectively to a rare level.

    Mooly Eden ( of Intel Israel prior ) might come close to Brian but I do not know specifics of his company wide skills ( design management he is gonzo good with the Core M and COre 2 series higher clock jump ) and Mooly is well regarded/

    BUT BRING BRIAN BACK HONORABLY.
    The folks who lead to Brian's resignation need FIRED ( really ) as there was conflict of interest that reminds me of Ken Levy being fired from KLA / Tencor that he founded as KLA Instruments long ago. Ken Levy was incomporable to have lead SEMI for decades, and was a brilliant technologist versus some of the yutzes running KLA today ( really ) ( KLA director of advanced technology actually caused 40yr old Perkin Elmer EG&G Reticon to FAIL since he got zero wafer yield of sensors and was told how to remedy 2 ways, but refused )
    Reply
  • Marlin1975 - Thursday, June 21, 2018 - link

    Good time to get out. looking bleak at intel for the next year or two.

    AMD will gain market share.
    Intel 10nm is behind and most will be on 7nm by the time Intel gets it fixed.
    Meltdown/Spectra seems to be getting worse with more bugs coming out and now affecting HT for Intel.
    etc...

    So good time to pull the golden parachute and walk away before the blame hits him.
    Reply
  • formulaLS - Thursday, June 21, 2018 - link

    Yeps, it probably has more to do with his CEO performance and using improper employee relationships as an excuse. Reply
  • iwod - Thursday, June 21, 2018 - link

    I hardly doubt they would use that as an excuse. He could have said personal health issues or family health issues.

    https://newsroom.intel.com/biographies/executive-m...

    Shows only a handful of people that could have been directly reporting to him.
    Reply
  • FunBunny2 - Thursday, June 21, 2018 - link

    "Shows only a handful of people that could have been directly reporting to him."

    the PR, as I read it, didn't say a direct report during his stay as CEO. could be anyone he's ever been over.
    Reply
  • rahvin - Thursday, June 21, 2018 - link

    Health and family are code words on Wall Street. This resignation was for cause and it had nothing to do with the affair but was blamed on that to avoid sparking a sell off on wall street as it would be Intel admitting they have a very serious problem that they have not yet acknowledged to wall street. Reply

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