Following Intel’s (INTC) disastrous 7nm product delay due to a process “defect mode”, the company has announced a major shakeup to its tech team – including the departure of Chief Engineering Officer Murthy Renduchintala on August 3 2020.
According to Intel this will “accelerate product leadership and improve focus and accountability in process technology execution.”
The Technology, Systems Architecture and Client Group (TSCG) will be separated into five teams, with leaders reporting directly to CEO Bob Swan:
- Technology Development – Run by Dr. Ann Kelleher & Dr. Mike Mayberry with the focus on 7nm and 5nm processes.
- Manufacturing and Operations – Run by Keyvan Esfarjani with the focus on product ramp and new fab capacity build-outs.
- Design Engineering – Run by Josh Walden in the interim.
- Architecture, Software, and Graphics – Run by Raja Koduri with the continued focus of developing Intel’s architecture and software strategy and graphics portfolio.
- Supply Chain – Run by Dr. Randhir Thakur with the focus on ensuring the supply chain is a competitive advantage for the company
Following the news Rosenblatt analyst Hans Mosesmann reiterated his Sell rating on Intel with a $45 price target. “Murthy’s departure is not surprising given recent developments of Intel’s 7nm delay and likely move to a fab-lite and/or fabless business model over time” he wrote.
Mosesmann continued: “As was the case with Murthy, a relatively recent non-Intel ex-Qualcomm player, senior management is still non-Intel and not engineering-centric in terms of historical skill sets.”
According to the analyst Intel is a company in major upheaval and not at all in control of benefiting from industry transitions, much less its own process and architectural roadmaps. He believes it will take years before things can stabilize for the company, adding “If and when this happens, Intel likely never regains semiconductor excellence and compute supremacy.”
Shares in Intel are down 17% year-to-date, with a 19% drop in the last week alone. Analysts have a cautious Hold consensus on the stock with a $58 average analyst price target (16% upside potential). (See Intel’s stock analysis on TipRanks).
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