The CEO of $25 billion VMware denies a report that he's stepping down amid a huge leadership brain drain

Pat Gelsinger VMware


VMware CEO Pat Gelsinger

VMware CEO Pat Gelsinger says he's going nowhere, despite a recent report saying he'll step down once the Dell-EMC deal is completed.

"I categorically deny it. EMC categorically denies it. And Dell categorically denies it. So there's absolutely no merit or substance to the rumor whatsoever. And my intention is to stay here and Michael's intention is to stay here, as well," Gelsinger said, referring to Dell CEO Michael Dell, at the Jefferies Technology Conference held Wednesday.

His comment was made in response to a CRN report on Tuesday that said Gelsinger could possibly get replaced by GoPro president Tony Bates, citing unnamed sources. The report suggested that Gelsinger was getting pushed out for performance reasons and due to tensions with EMC/Dell management, adding the announcement could come as early as in August.
But Gelsinger shrugged off rumors of management friction, saying he joked about the CRN report with Dell at a company retreat held Tuesday, according to the audio replay of Wednesday's talk.

"I got the heads up from the PR rep about the rumor, I got a text from him, and I handed my phone to Michael, and asked, 'Michael is there something that I don't know?' And we, of course, got a laugh about it. But absolutely no basis for it, whatsoever," Gelsinger added.

A string of departures

Gelsinger's remarks clear a lot of air around his job, which has long been rumored to be next in line to be canned, following a series of leadership departures at VMware. Just over the past few months, the company's COO, CTO, and CFO have all left, in addition to a bunch of VP-level star executives. With Dell soon expected to merge with EMC, which owns 81% of VMware, it seemed only reasonable that the company's entire management would get overhauled.

On top of that, as the CRN report noted, Gelsinger was noticeably absent from EMC's annual conference, EMC World, where he typically makes a big presentation. Dell made the speech instead, adding fuel to rumors of Gelsinger's exit.

Despite all the rumors and changes, VMware delivered a surprisingly strong quarter last month, causing its stock to jump 13% in after hours trading. Still, VMware shares are down nearly 35% over the past 12 months. "There's a lot of skepticism at VMware given the transition," Gelsinger said at the Jefferies conference. "There are all sorts of transitions in the industry, and we're working through it and our strategy is playing out well with customers and the industry."

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