Intel Corp. named Robert Swan as its seventh chief executive officer, filling the most prominent role in the semiconductor industry at a time when rivals are challenging the company’s 30 years of market dominance.
Swan, 58, has been interim CEO for seven months and chief financial officer since 2016. Todd Underwood, vice president of finance and director of corporate planning and reporting, will become interim CFO during the search for a permanent replacement, Intel said Thursday. The shares fell as much as 2.9% in early U.S. trading.
Swan takes the top job at a crucial time in Intel’s history. The chipmaker reported record sales and profit for 2018, but fell short of analysts’ projections for the fourth quarter and gave a disappointing forecast for 2019. Intel’s processors are the heart of more than 90% of the world’s laptops and almost all server computers, yet delays in introducing new chip-manufacturing technology have led some analysts to warn that the company is more vulnerable to competition than it has ever been.
The appointment fills a seven-month vacuum caused by the ouster of his predecessor, Brian Krzanich, who left after the board was informed he had an affair with an employee. Under Krzanich, many of the senior executives that had risen through the ranks and were natural successors — Renee James, Kirk Skaugen, Stacy Smith and Diane Bryant — departed amid an unprecedented influx of senior executives from outside.
Naming Swan breaks Intel’s long-established leadership grooming process. All of Swan’s predecessors either founded the company or spent their entire career there. The chipmaker has a program of identifying promising young managers and apprenticing them to senior executives to give them experience and test them.
In the final years under Krzanich, who built his career in the company’s factory network, Intel admitted it was having problems introducing new manufacturing technology. For the first time in decades, Intel is now faced with the possibility that rivals will have chips in the market built with techniques that are more advanced than its own.
Leadership in manufacturing has been a crucial part of Intel’s success. Shrinking the dimensions of the microscopic transistors that give chips their function enables designers to create products that can be cheaper, can process or store more data or work more efficiently. Intel said 10-nanometer production chips would be in the market in the second half of last year. It’s now saying that will happen toward the end of 2019. That’s led analysts and investors to speculate that the company’s dominance of computer processors is under threat.