Why Intel's CEO Exit Has Investors Worried

Investors in Intel are feeling uneasy these days. The sudden departure of CEO Pat Gelsinger has sent the company's stock on a downward spiral. Despite an initial rally on Monday, the shares have been falling ever since. Industry experts are pointing fingers at the Intel board for how they've handled the situation. Patrick Moorhead, CEO of Moor Insights & Strategy, took to LinkedIn to criticize the board. He said he saw this coming. According to him, the board didn't provide any explanation for Gelsinger's exit or name a replacement immediately, which has left investors confused and worried about what's next. Gelsinger's departure doesn't come as a complete surprise. Bloomberg reported that he was forced out due to a loss of confidence in his ability to turn the company around. Intel has been struggling to compete with rivals like Nvidia and AMD. In response, Intel appointed two interim CEOs: David Zinsner and Michelle Johnston Holthaus.Moorhead believes that Intel needs to find a strong replacement quickly. He says that he's talked to executives from their biggest customers, and none of them are celebrating this change. The company is at a critical juncture and needs stable leadership. Ben Reitzes from Melius Research also weighed in on the situation. He said that while Gelsinger's departure wasn't entirely unexpected, the timing caught some off guard. Some investors might have seen this as an opportunity for the company to make cuts or sell assets to create more value for shareholders. However, Reitzes saw it as a negative move. Intel's stock closed at 21. 96 on Wednesday, down by 2. 3%. This week alone, the stock has lost near 9%, falling well below its 50-day moving average. In the span of a year, Intel's Relative Strength rating has plummeted from 96 to 13, according to IBD MarketSurge.