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VMware loses CEO Gelsinger to Intel

News Analysis
Jan 13, 20213 mins
Cloud ComputingData CenterNetworking

Intel says it will bring on current VMware CEO Pat Gelsinger Feb. 15 to replace Intel CEO Bob Swan.

VMware CEO Pat Gelsinger
Credit: Daniel Masaoka

Intel said it will bring on current VMware leader Pat Gelsinger as its new chief executive officer, effective Feb. 15, 2021.  The 40-year technology industry vet replaces Intel’s Bob Swan, who will remain CEO until that date.

For VMware, the company said it was initiating a global executive search process to name a permanent chief and that Zane Rowe, current VMware CFO will become interim CEO.

“Pat led the company in expanding our core virtualization footprint and broadening our capabilities to cloud, networking, 5G/edge and security, while almost tripling revenue to nearly $12 billion,” Rowe said in a statement. “VMware remains focused on helping customers optimize their digital infrastructure—from app modernization and multi-cloud to networking, security and digital workspaces. We look forward to continued growth and innovation across our technology offerings.”

Gelsinger, who spent some 30 years at Intel and was its CTO, was by most accounts being set up to be Intel’s CEO before leaving for EMC in 2009 and then taking the reins at VMware in 2012.

While at Intel, he helped create key technologies, including USB and Wi-Fi, led Intel to be the dominant supplier of the microprocessor—while in the significant role as the architect of the original 80486 processor, according to his VMware bio.

At VMware he led a variety of company transformations, the latest being its push to support all things Kubernetes with its Tanzu effort.

“Having begun my career at Intel and learned at the feet of [semiconductor pioneers Andrew] Grove, [Robert] Noyce and [Gordon] Moore, it’s my privilege and honor to return in this leadership capacity,” Gelsinger said in a statement from Intel.  “I have tremendous regard for the company’s rich history and powerful technologies that have created the world’s digital infrastructure. I believe Intel has significant potential to continue to reshape the future of technology and look forward to working with the incredibly talented global Intel team to accelerate innovation and create value for our customers and shareholders.”

Gelsinger by most accounts, will be taking on a significant challenge in recharging Intel.  For example, CNN Business reported that under Swan, Intel has struggled. “It lost market share to rival AMD, and its stock hasn’t grown as fast as its competitors. Intel was also dealt a blow when Apple announced it will use its own processors, rather than Intel’s, in its new series of Macs,” CNN stated.

The Wall Street Journal wrote that in December, Daniel Loeb, the CEO of activist hedge fund Third Point LLC’s, wrote a letter to Intel Chairman Omar Ishrak saying, “the company’s woes could threaten the U.S. tech industry.” He urged the chip maker to consider alternatives, including selling some of its acquisitions and splitting its design and manufacturing operations—a move that would end Intel’s long-held status as America’s leading integrated semiconductor maker.