I would liken firing Pat in the final hour of 18A to quitting the final round of chemotherapy in cancer treatment. Instead of seeing the long and painful process through, I think the board will let Intel die and be sold for parts. It’s the correct answer to maximize relatively short-term shareholder value, but it's a nearsighted move that the Intel board specializes in.
The board is pretty horrific. Most of the people have no technical expertise, and many of the people most at fault for getting Intel to where it is, are
still on the board.
Let’s take a second to acknowledge that
Boeing's EVP of operations is the audit committee head and has been on the board for the entire fiasco. That’s probably the only other American giant having as bad a time as Intel!
The board has decided to gut Intel. Four former board members
wrote an OpEd about splitting the company in two. The winds of change are clearly to abandon IDM 2.0, and Pat doesn’t fit into that picture.
They have fired the technical leader they needed to turn around Intel. There are valid reasons, as Pat’s naive optimism can feel delusional. It never felt like he never
truly acknowledged the problem at hand and had visions of old Intel in his head. But he wanted to do the job, and that’s hard to say for most people. Meanwhile, the transcript out today talking about “rightsizing utilization” implies that the Board didn’t like his grand plans (overly optimistic plans) for IFS and saw the product imploding. At the same time, the CEO focused on the loss-making part of the business.
But that’s the thing—
the profitable part of the business is commoditized and will only worsen. I would argue that it’s a former monopoly that has become commoditized and will soon become worse.
It makes sense to focus on the future, and IFS could have been one of two (TSMC) instead of a product group, which is one of many. The moonshot has always been IFS; now it’s time for plan B. And I frankly find Plan B to be uninspiring.
