Intel’s new CEO Pat Gelsinger is expected to raise well over $ 100 million in his new role.
The chipmaker offered surprising incentives to attract Gelsinger from his current role, running VMware, which most recently valued its annual compensation at more than $ 42 million. Intel released Gelsinger’s payment package on Thursday, the day after his unexpected hiring.
The vast majority of what Intel promised Gelsinger depends on performance, so it can be worth a lot less if things go wrong – or even more if the company stands out under your leadership.
In any case, however, it is a huge amount of money. Evidently, this was what drove Gelsinger away from VMware, which is thriving, and jumping into a crisis situation at Intel.
Intel has lost its leading role in the chip industry in recent years, following a succession of manufacturing failures in three consecutive generations of new microprocessors. Gelsinger, a former chief technology officer at Intel, will be tasked with restoring Intel’s engineering advantage.
Intel has announced a deadline until next Thursday to announce whether to outsource its high-end manufacturing to rivals in Asia or to maintain this work internally.
Although headquartered in Silicon Valley, its largest and most advanced operations are in Washington County. Intel employs more than 21,000 in Oregon, where it develops and manufactures each new class of computer chip.
The decision to hire Gelsinger was a surprise because Intel promoted current CEO Bob Swan to the most important position less than two years ago. Intel valued Swan’s compensation in 2019 at $ 67 million, which was inflated by bonuses associated with its promotion. (His salary was not released in 2020 yet.)
Gelsinger, 59, spent 30 years at Intel and was among its top engineers and top executives in Oregon when he left the company in 2009. He became CEO of VMware in 2012.
Intel said on Thursday that it will pay Gelsinger $ 1.25 million in base salary, a $ 1.75 million hiring bonus and an $ 3.4 million annual bonus, depending on performance. . If Gelsinger buys up to $ 10 million in Intel shares, the company said it will give him an equivalent number of restricted shares.
In addition, Gelsinger is expected to receive $ 100 million in restricted shares – depending on Intel and the price of its shares to meet various performance metrics. Therefore, he can receive considerably less than that – or potentially even more. The restricted shares accumulate for a period of five years, depending on Gelsinger’s stay at Intel.
For 2019, Intel reported that its average employee earned $ 96,300. Swan, the outgoing CEO, received 695 times that amount.
– Mike Rogoway | [email protected] | Twitter: @rogoway | 503-294-7699