MarketWatch First Take: Which Intel CEO is to blame for the current woes? Or is it actually AMD’s CEO?

by | Jul 28, 2022 | Stock Market

As Intel Corp. investors try to parse through the wreckage of its disastrous second quarter, one nagging question will not go away: Which chief executive is to blame for the debacle — current CEO Pat Gelsinger, his predecessor, or rival Advanced Micro Devices Inc. CEO Lisa Su? The chip giant reported a huge second-quarter miss Tuesday, including a nearly $1.6 billion revenue miss in its all-important data-center business, citing the macroeconomic environment and some internal execution issues. Intel’s
results were so bad that as shares plunged nearly 10% in after-hours trading, one analyst asked on the company’s conference call why Intel did not pre-announce the results.

“We were well into the quarter and we saw the market characteristics change quite suddenly,” Gelsinger said. “We wanted to be in a position that we had a thoughtful view of what the market was for the future.” In a confusing conference call with Gelsinger and new Chief Financial Officer David Zinsner, one thing gradually became clearer: The chip giant had a big production problem, or a bug, with one of its anticipated data-center/server chips, code-named Sapphire Rapids. Intel had to restart the manufacturing process, thus causing a further delay and a charge for a chip now expected to go into volume production by the end of this year and into 2023. “Sapphire Rapids is a year late,” explained Pat Moorhead, principal analyst at Moor Insights and Strategy. Gelsinger made a couple of references to inheriting problems when he came back to his alma mater as CEO in early 2021, replacing Brian Krzanich. “Many of these products were well underway when we showed up,” Gelsinger said. “As we s …

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