by Staff Writers
San Francisco (AFP) May 2, 2013
Intel Corp. named Brian Krzanich chief executive Thursday as the struggling chipmaker grapples with a rapid shift from desktop computers to smartphones, tablets and Internet "cloud" services.
Krzanich, an insider who has been chief operating officer since January 2012, will assume the new role at the company's annual stockholders' meeting May 16, replacing the retiring Paul Otellini.
The move comes with Intel, the world's biggest maker of chips for personal computers, trying to adapt to the shift to soaring demand for small, energy-sipping processors for smartphones and tablets.
And, as modern lifestyles shift to using programs as services hosted in the Internet "cloud," Intel is under pressure to innovate when it comes to powering servers in datacenters.
Krzanich, 52, will become the sixth CEO in Intel's history. Otellini announced last year he would step down as CEO and from the board of directors on May 16.
"After a thorough and deliberate selection process, the board of directors is delighted that Krzanich will lead Intel as we define and invent the next generation of technology that will shape the future of computing," said Intel's chairman Andy Bryant.
"Brian is a strong leader with a passion for technology and deep understanding of the business. His track record of execution and strategic leadership, combined with his open-minded approach to problem solving has earned him the respect of employees, customers and partners worldwide."
Analysts said the move suggests Intel will maintain its focus on its core products rather than shift rapidly into areas such as mobile chips where it faces tougher competition.
"Krzanich was the logical choice," said Ross Seymore at Deutsche Bank.
"We have always viewed manufacturing as Intel's core sustainable advantage and Mr. Krzanich understands this aspect of Intel's business better than anyone else."
Vijay Rakesh at Sterne Agee said investors "have been waiting to get an idea of the next CEO to gauge some idea of the future direction for Intel."
The choice of Krzanich "might indicate more of a focus on manufacturing-foundry strategy versus mobile," Rakesh added. "Overall, filling the spot definitely removes some overhang and uncertainty."
In the first quarter of 2013, Intel said its profit fell 25 percent to $2 billion, while expressing optimism over its new efforts in the mobile space.
Revenues were down 2.4 percent for the year at $12.6 billion, mainly due to lower PC sales.
In documents filed with regulators, Intel said Krzanich would be paid a base salary of $1 million and have an annual incentive cash target of $2.5 million, plus stock awards, bringing total compensation to an estimated $10 million.
Intel also named as president Renee James, who has been executive vice president and general manager of its software and services group.
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