Intel’s CEO steps down
Intel (INTC) took the market by surprise with the announcement of the immediate resignation of its CEO, Brian Krzanich, who has served in this position since 2013. He has even left the board. Intel’s chief financial officer, Robert Swan, has taken up Krzanich’s position on an interim basis, and the company’s board has also started the search for a permanent replacement both internally and externally.
The decision comes after an investigation by internal and external counsel found Krzanich guilty of violating the company’s non-fraternization policy, which prevents managers from having relationships with staff who report to them directly or indirectly.
A CNBC report stated that Krzanich’s consensual relationship with an unnamed Intel employee started “some time back” and has already ended.
Intel revises fiscal Q3 2018 guidance
In the same announcement, Intel also revised its earnings guidance for fiscal Q3 2018 upwards in order to cool the situation. It raised its revenue guidance for the quarter from $16.3 billion at the midpoint to $16.9 billion, which is even higher than the upper range of its previous guidance of $16.8 billion.
Its revised non-GAAP EPS guidance of $0.99 is also above its previously guided range of $0.80–$0.90.
However, shareholders appear to care more about Krzanich’s resignation, and the stock might dip today and tomorrow.
What does it mean for shareholders?
Krzanich was tasked with transforming Intel from a PC-centric company to a data-centric company. This transformation got Intel back to earnings growth. The next big question is who will be the next CEO. Intel’s head of Technology, Systems Architecture and Client Group and former co-president of Qualcomm (QCOM), Murthy Renduchintala, is a potential candidate.
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