Paul Otellini had been head of Intel for eight years, and seen it consolidate its grip on the PC microprocessor market – though it is increasingly under threat from chips in smartphones using the ARM architecture pioneered by a British company.
The Intel board said it will begin searching for a replacement internally and externally, a process it says could take up to six months. The stock dipped briefly before being halted. Since 2008, Intel's stock has dropped 20%, though it is still the fourth-largest listed technology company, worth about $100bn, behind Apple, Microsoft and Google.
Otellini, 62, joined the company in 1974 – the same year it released the 8088 chip, on which the original IBM PC was based. That architecture went on to become the basis of Intel's riches – the company is now the world's largest and richest maker of microprocessors, particularly the CPUs (central processing units) that power PCs. In 2002, he was named president and chief operating officer, and became chief executive three years later.
His departure marks the third upheaval in as many weeks among three of the oldest companies in the business. On 29 October Apple pushed out two of its top executives, iPhone software chief Scott Forstall and retail head John Browett. Then last week, Microsoft said goodbye to Steve Sinofsky, who had led the Windows team to the launch of its new Windows 8 operating system just a week earlier.
Otellini, who oversaw Intel's shift into wireless – first through the introduction of Wi-Fi into its Centrino processors in 2003, before taking over as chief executive, and more recently in the focus on trying to compete with ARM chips in smartphones and tablets.
His departure comes as Intel is trying to find the best way to compete as the PC market slows down and spending shifts to smartphones and tablets. Even Microsoft, which was once its staunchest ally in driving spending on Intel CPUs for new PCs, has loosened its ties by introducing a new version of Windows, called WinRT, that runs on ARM-architecture chips, and showing off its capabilities in its own Surface RT tablet with attachable keyboard.
Intel has promoted three executives to executive vice president: Renee James, head of its software business; Brian Krzanich, chief operating officer and head of worldwide manufacturing; and Stacy Smith, chief financial officer and director of corporate strategy.
More details soon ...
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