It's the abrupt end of an era for Intel Corp. (INTC)
Brian Krzanich, Intel's CEO since 2013, resigned on Thursday, June 21 after it was revealed that he had a past consensual relationship with an employee. The company has a non-fraternization policy.
Under Krzanich, the company managed to enter and dominate new markets such as data server chips, and he also engineered a major turnaround of the chipmaker's business. Intel's PC unit bucked industry-wide declines and continued to grow, even though it's now a smaller share of the company's overall business.
In addition, Krzanich charted new frontiers for Intel, such as building semiconductor chips to power autonomous vehicles, cloud computing, artificial intelligence and 5G wireless networks.
Under his watch, Intel's shares rose about 120%, in line with the Nasdaq's performance over the same time period, but outpacing the Dow Industrials Average and the S&P 500. In early afternoon trading, Intel was down around 2.4% to $52.18. Year to date, shares are up about 13%, roughly in line with the Nasdaq's rise over the same time period.
In an interview with TheStreet in 2017, Krzanich said "People do ask 'How are you getting your return?' I tell them there's a couple of ways. When we look at a market like this, we not only look at the computer that's in the car, we also look at the data center that's having to be built out. We not only look at it as what's the future of autonomous cars, we really look at them as devices that are generating data [that's sent] to data centers. That's actually occurring right now and growing rapidly as we go through that continuum of autonomous driving. That's part of why we want to be a part of this business. So our returns start almost immediately."
Here are the biggest moves Krzanich made as Intel's CEO:
1. Increasing Intel's competitiveness
Under Krzanich, Intel has made significant moves to improve the quality and specs of its chips relative to its rivals.
"We absolutely see the competition. It's continuing," said Krzanich in 2017. "ARM Holdings has been a competitor, Qualcomm has always been a competitor. You can argue there's some better ones now. I think it will always get better and more intense. We don't take that competition without our typical paranoia and focus to make sure we continue to drive our performance. Rather than focus on just purely the CPU performance, which we absolutely have a focus on and will be and remain the leader, we're actually thinking of the whole data center rack now. We're really building out a rack so that if someone wants to come compete with us, you really have to compete in all those segments."
2. Getting into autonomous driving
In a major move to get into a fast-growing sector, Intel acquired Israeli firm MobilEye in March 2017 for $15.3 billion, which specializes in building chips for autonomous driving.
Said Krzanich in 2017, "we started our efforts with autonomous driving roughly three years ago. What you've seen over the three years, as we really learned what is required, is this constant acceleration to where it became [something that would definitely happen] by mid-decade, or 2024 to 2025. Then it became early in the decade -- 2021. There's really a race toward how soon can you do this and what is the continuum of autonomy."
Intel estimates that the vehicle systems, data and services market opportunity to be up to $70 billion by 2030.
3. Emphasizing artificial intelligence
Krzanich took Intel deeper into the artificial intelligence (AI) arena, pushing the firm to acquire Movidius, a company that specializes in AI, in 2016.
According to the Intel website, its "artificial intelligence strategy is to help ensure that every data scientist, developer and practitioner has access to the best platform and easiest starting point to solve the AI problem being tackled from the data center to the edge."
In May, Intel hosted its inaugural AI DevCon event in San Francisco, and in February, Intel announced a new program called "Intel AI: In Production." The program is designed to help AI developers bring their prototypes to market.