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Intel CEO Brian Krzanich resigns amidst relationship scandal

Chief executive has resigned after five years over "past consensual relationship with an Intel employee," the company said Thursday. Robert Swan has been named interim CEO.

Brian Krzanich, who has resigned from Intel



Intel announced Thursday that Brian Krzanich, its CEO since 2013, has resigned his position. The resignation follows the revelation that Krzanich had a "past consensual relationship" with a company employee, which violated Intel's non-fraternization policy for managers.

Krzanich had worked for Intel for his entire professional life, starting in 1982.

Robert Swan, the company's chief financial officer and the former CFO of eBay, will step in immediately as interim CEO. Intel's board, the company said, has a "robust succession planning process in place," and is searching for a permanent CEO.

Apple and Intel



Krzanich on CNBC in 2015



Apple and Intel have been close partners since Steve Jobs switched the Macintosh CPU to Intel x86 processors starting with the products released in 2006. Intel does not make the processors for the iPhone, but it does supply the modems.

The change in leadership at Intel comes at a time when Apple is reportedly considering dropping Intel chips from Macs starting in 2020, and taking chip production in-house. However, a report in June stated that Apple could use Intel's high-performance discrete graphics chips in future Macs. And a May report stated that Intel's modems for the iPhone could eliminate the need for Qualcomm chips, as soon as this year's models.

In early 2014, Krzanich said in an interview that Intel and Apple's relationship was growing closer.

"We've always had a very close relationship with Apple and it continues to grow closer," Krzanich said in a Reddit "Ask me Anything" session "Sure (it's) grown close over the years, especially since... they started to use our technology in their systems."

A year later, in response to another round of rumors about Apple taking its chip production in-house, Krzanich expressed confidence that Intel could keep innovating in order to keep Apple's business.

"Our job is to continue to deliver parts that have that capability, that are better than our competitors, and then they want to use our parts," he told CNBC.

Falling behind?



Intel chips



In recent years, Intel's ability to keep on track with upgrades to processor architectures has become an issue, especially with regard to hardware heading into Apple's Mac product families.

In 2016, Intel confirmed it was moving on from its Tick-Tock development strategy of producing a new process (tick) followed by an architecture overhaul (tock) to a Tick-Tock-Tock system, adding an optimization period to the end of the chain. The change in cadence meant Intel would continue working on producing chips under the existing process, allowing it more time to perfect the die shrink "tick," such as from a 14-nanometer process to 10 nanometers.

A more recent issue has been the repeated delays in "Cannon Lake," a chip generation that offers the prospect of a MacBook Pro with 32 gigabytes of memory. The Cannon Lake processors include native support for LPDDR4 memory, which would allow Apple to avoid adding a separate RAM controller that could increase the memory capacity to 32 gigabytes, without using the more power-hungry DDR4 memory.

Originally slated for the end of 2017, the delays in the 10-nanometer Cannon Lake chips have pushed the release back a number of times, but did launch its first chip from the generation in May.

Even so, it is unlikely for MacBooks to use Cannon Lake chips for some time, as an Intel quarterly earnings report from April noted it will not move to high volume manufacturing of chips using the architecture until 2019, citing yield issues creating the 10-nanometer chips.

The new guy



Robert Swan, Intel's new interim CEO



Swan had been CFO since 2016, reporting directly to Krzanich.

"Intel's transformation to a data-centric company is well under way and our team is producing great products, excellent growth and outstanding financial results," Swan said in Intel's statement. "I look forward to Intel continuing to win in the marketplace."

In the same announcement, Intel said it expects to earn records revenues of $16.9 billion when it announces second-quarter earnings on July 26.