Intel's 'Bench', Strategy Right for Post-Otellini Era: Barrett
The early retirement of Intel's CEO Paul Otellini is not really surprising, but the company has the right mix of talent and strategy to carry it forward, said said Craig Barrett, the chipmaker's former CEO.
Intel said on Monday that Otellini, 62, will step down as CEO in May. The company's internal rule, however, requires CEOs to retire when they turn 65, which means Otellini had a few more years remaining as CEO before he would have been pushed out.
While the board may be considering outside talent to run the company, Barrett said that Intel currently has strong enough internal candidates that could replace Otellini.
"I still think Intel still has bench strength... I think they've got more than enough talent inside to continue the strategy, and continue to have Intel perform as a great company," Barrett said to CNBC's Power Lunch on Tuesday.
"I wasn't terribly surprised that Paul decided to step down a bit early. He'd been talking to his friends about that and I suspect the board knew that as well," Barrett said. "I was a little surprised that the board did not name an internal successor to Paul right away," he added.
Intel will consider internal and external candidates for the CEO position and a "leadership transition" will last about six months, Intel's board said Monday in a statement.
While the chipmaker remains the dominant manufacturer of processors for personal computers, the company has struggled to shift its business swiftly enough towards the booming mobile industry. Those devices require low power microprocessors to build devices.
Meanwhile, ARM Holdings, a company that licenses out chip technology to build low-power chips, has benefited from Intel's shortcomings by selling technology to companies like Apple. he tech giant uses chip designs for its signature digital devices, such as iPhones and iPads.
Intel, however, is growing its mobile chip making business, Barrett said. It's just taking more time than expected for the company to catch up with an industry that has a large head start.
"I think they've got some good strategy there, it's just going to take some time to make those inroads," Barrett said. "But I think the capability is there and the strategy is right."