Pat Gelsinger, who recently stepped down as CEO of Intel, is set to walk away with a severance package worth over $10 million.
According to a filing with the Securities and Exchange Commission (SEC), Gelsinger’s departure includes a retirement and separation agreement that will provide him with several payouts.
Gelsinger will receive 18 months of his base salary of $1.25 million, totaling $1.875 million. Additionally, he will be entitled to 1.5 times his target bonus, which is 275% of his base salary, amounting to $5.16 million. Both of these payments will be distributed over 18 months.
In addition, Gelsinger will receive a pro-rata payment for 11/12ths of his 2024 annual bonus, which is tied to the company’s performance. This could add around $3.15 million, bringing his total severance to at least $7 million, with the potential to reach $10.18 million.
Gelsinger’s exit comes at a difficult time for Intel, which has faced significant challenges this year. The company’s valuation dropped by 30% in August after reporting a net loss of $1.6 billion, compared to a profit of $1.5 billion the previous year. In response, Intel announced it would lay off 15% of its workforce, approximately 15,000 employees, to cut costs.
While $10 million may seem modest compared to some other high-profile executive exit packages, such as the $400 million received by WeWork’s Adam Neumann or $54.9 million for Yahoo’s Marissa Mayer, it is notable that Intel’s market cap was over $200 billion when Gelsinger took the CEO role in 2021. At the time of his departure, the company’s market value was considerably lower.
Reports indicate that Gelsinger was given the option to retire or face dismissal, with his departure effective December 1.
He will be replaced by interim co-CEOs David Zinsner, Intel’s CFO, and Michelle Johnston Holthaus, the General Manager of the Client Computing Group. Intel’s board has also established a search committee to find a permanent successor.
Following the news of Gelsinger’s exit, Intel’s stock initially surged but later settled at roughly the same price, signaling ongoing uncertainty about the company’s future as it transitions to a foundry chip-manufacturing model.
