Brian Krzanich says chip maker well-positioned to make up for its slow start in smartphones, tablets.
Intel Corp.’s new chief executive vowed Thursday to rapidly grow the company’s presence in the tablet and smartphone markets at a shareholder meeting that formalized a major management shift for the Silicon Valley chip giant.
Brian Krzanich, who was recently named chief executive, said although Intel has been slow to respond to the rapid rise of tablets and smartphones, the company is well-positioned to participate going forward.
“What we have will allow us to grow in this area much faster in the future,” he said. Intel’s annual meeting provided the first opportunity for Mr. Krzanich, whose appointment to CEO became effective Thursday, to address shareholders.
He was named to the post May 2, following a selection process set off in November by the surprise decision of Paul Otellini to step down as CEO, three years before Intel’s mandatory retirement age. Intel, in a break from tradition, evaluated external candidates as well as internal ones before settling on Mr. Krzanich, a 52-year-old company veteran who rose through its manufacturing ranks and had previously been chief operating officer.
While he was widely regarded as a front-runner for the job, Mr. Krzanich surprised some Intel-watchers by asking the board to promote Renee James to be president. The longtime software chief has been associated with some high-profile Intel flops, while her personal style is characterized by some on Wall Street as abrasive.
But Mr. Krzanich and Andy Bryant, Intel’s chairman, credited Ms. James with helping to develop a new strategy for the company that impressed Intel directors. Though few details have been spelled out yet, the Intel executives have indicated that the strategy is designed to accelerate the company’s moves to place its chips in more products beyond computers.
Intel’s delay in playing a meaningful role in smartphones and tablets have held its stock price down for years. Mr. Krzanich, Mr. Bryant and Ms. James fielded questions from stockholders during the meeting, including one who complained about the company’s share price, which has fallen nearly 2.9% over the past five years.
Stacy Smith, Intel’s chief financial officer, said in an interview the company’s strategy of pushing further innovation in the PC industry while also making more efficient chips for mobile devices will ultimately succeed. While the mobile device industry is exploding, demand for data centers and servers is rising with it, he said.
“We’re uniquely positioned to benefit from that trend,” he said.”As a business, it’s been growing at a very fast rate.”
Mr. Smith said he is excited about the transition the company is on and working with Mr. Krzanich as he starts his tenure as the company’s sixth chief executive.
Mr. Krzanich said he is developing new processes for the company, including ways to bring in consultants and other people to help the company spot industry changes and respond to them quickly. On his appointment, Mr. Krzanich said his vision for the company included a focus on new markets as well, including wearable devices.
Also at the meeting, the company said each director up for election received between 85% and 99% support among votes cast by shareholders. The company’s advisory vote on executive compensation didn’t receive as much support, pulling only 68% of yes votes. A stockholder proposal requiring executives to hold a certain percentage of shares until retirement failed to gain enough traction among shareholders to pass.
Intel shares recently traded up 0.3%, to $24.27. The stock is up around 18% this year.