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The Sudden Departure of Intel’s CEO

Intel has made strides on mobile chips, but apparently not fast enough to win market share.
November 19, 2012

Intel is a very well-run and methodical company that likes to carefully manage big moments like CEO transitions. So it was surprising to see today that the company appeared to be surprised by CEO Paul Otellini’s decision to retire in May at age 62. There is no clear successor.

It’s a reminder that Intel faces something that could bubble over into a crisis. As we showed in this chart last week (“The Pressure’s on for Intel”), the company has failed to keep up with the computer industry’s shift to mobile devices. In those devices, energy-efficient chips based on a different architecture, designed by ARM Holdings, are dominant. Intel has made impressive gains lately in the performance of its mobile processors, but they haven’t yet translated into market share gains. Meanwhile, ARM-based chips could start to make significant inroads into Intel’s traditional market for server processors. This is why Intel shareholders are in roughly the same position they were a decade ago.

If there’s an upside for Intel, it’s this: it can tell CEO candidates that they have a chance to be the company’s savior.

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