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Outgoing Intel CEO Pat Gelsinger is set to get paid as much as $10 million as he exits the struggling tech giant.
Gelsinger will receive 18 months of his base annual salary of $1.25 million, or $1.8 million, and 1.5 times his target bonus of $3.4 million, or $5.16 million, which will be paid out over the next 18 months, Intel (INTC-1.63%) said in a regulatory filing on Tuesday.
Gelsinger will also receive a payment equal to 11/12ths of his 2024 bonus — which is subject to company performance — that he would have received had he not resigned. That would be a little more than $3 million.
His departure comes as the chipmaker struggles to keep pace with massive competitors like Nvidia (NVDA+0.30%) in the artificial intelligence boom. In recent months, Intel has also been the subject of activist investor interest, including a potential takeover bid, as its performance has lagged.
In early November, Intel was kicked out of the Dow Jones Industrial Average to make room for Nvidia, which has been hailed as an “AI darling.” Intel’s stock has fallen by more than 52% in 2024 as of Tuesday, while its rival’s stock has surged by more than 188%.
Although Gelsinger’s resignation was announced Monday morning, it came after what CNBC reports was a contentious board meeting over a lack of confidence in the CEO’s plans to compete with Nvidia.
Gelsinger had served as the company’s first chief technical officer before leaving the company. He returned in 2021 to take over for then-CEO Bob Swan in an attempt to stabilize and modernize the company.
“It has been a challenging year for all of us as we have made tough but necessary decisions to position Intel for the current market dynamics,” Gelsinger said in a statement Monday.
As the board searches for a new chief, the Santa Clara, California-based tech giant named David Zinsner and Michelle Johnston Holthaus as co-CEOs. Frank Yeary, the independent chair of Intel’s board and its interim executive chair, said the pair will continue the company’s mission to simplify and strengthen Intel’s product portfolio and advance manufacturing and foundry capabilities while cutting costs.
“While we have made significant progress in regaining manufacturing competitiveness and building the capabilities to be a world-class foundry, we know that we have much more work to do at the company and are committed to restoring investor confidence,” Yeary said in a statement.
“We are working to create a leaner, simpler, more agile Intel,” he said.