New Intel CEO Bob Swan takes a humble tone in a meeting with investors after a huge earnings shortfall: 'We let you down'
- Bob Swan assumed a humble tone in his first Intel shareholder meeting as CEO: "We let you down."
- Analysts were disappointed with Intel's earnings report last month, highlighted by weak data center business results.
- Intel shares slipped after Swan made his remarks. One analyst pointed to Intel's forecast of low-single digit percentage growth in next 3 years at the shareholder meeting.
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Intel CEO Bob Swan kicked off his first shareholder meeting as the chip giant's new boss with a display of humility after a downbeat earnings report that sparked doubts about the company's direction.
"We let you down," Swan told investors at the company's headquarters in Santa Clara on Wednesday. "And we let ourselves down."
Swan, who had served as Intel CFO, was named permanent CEO in January after serving on an interim basis following the resignation of Brian Krzanich. In late April, Intel reported disappointing earnings, highlighted by weak data center business revenues.
Despite Swan's comments, Intel shares slipped after hours on Wednesday. Wedbush analyst Joel Kulina pointed to Intel's projection of low-single digit percentage growth in the next three years as a possible reason why.
"Still lingering concerns over Swan as CEO vs bringing in tech/turnaround type of guy," he said in a note to clients following the meeting.
Analyst Patrick Moorhead of Moor Insights and Strategy said the Intel CEO's show of humility was not surprising, given Swan's past role as the chipmaker's chief financial officer.
"I think this is classic Bob Swan," he told Business Insider. "If anyone understands Intel investors, it's him."
Martinwolf Analyst Marty Wolf said Intel is clearly still struggling to bounce back after missing recent opportunities. For example, Intel stunned the business world by announcing that it was exiting the 5G modem business. Swan reaffirmed that decision at the investor meeting, saying, "we didn't see a path to make money."
The company's data center business, which was supposed to lead Intel to a new growth period, turned out to be a disappointment, posting its first revenue decline in at least five years.
"They have long development lead times, and they missed not one but multiple cycle entry points," Wolf told Business Insider.