Intel CEO Brian Krzanich abruptly resigned today after it was discovered he had a "past consensual relationship" with one of the company's employees. Effective immediately, CFO Robert Swan steps into his shoes on an interim basis.
Details of the relationship were not disclosed, including the length of time it took place or the identify of the employee that Krzanich was romantically involved with. The only thing Intel offered up was that an ongoing investigation by internal and external counsel confirmed he violated the company's non-fraternization policy, which applies to all managers.
"Given the expectation that all employees will respect Intel’s values and adhere to the company’s code of conduct, the board has accepted Mr. Krzanich’s resignation," Intel said.
This is not the first time Krzanich has been involved in a controversy of sorts at Intel. Earlier this year, it was discovered that Krzanich sold $39 million in company shares—the maximum he was allowed to sell at the time—prior to disclosing to the public critical CPU vulnerabilities known as Spectre and Meltdown. An Intel representative told MarketWatch the sale was unrelated to the vulnerabilities, and was made as part of a 10b5-1 plan, a mechanism that helps corporate insiders avoid accusations of insider trading by setting up plans to sell predetermined numbers of shares at a specific time.
His resignation also comes at a time when workplace relationships have been put under a microscope. Citing statistics from the Society for Human Resource Management, USA Today says that around 99 percent of organizations with romance polices outright ban relationships with supervisors and employees working under them.
Krzanich became CEO of Intel in 2013. While Swan is taking his place for the moment, Intel is on the hunt for a permanent replacement.
"The board believes strongly in Intel’s strategy and we are confident in Bob Swan’s ability to lead the company as we conduct a robust search for our next CEO. Bob has been instrumental to the development and execution of Intel’s strategy, and we know the company will continue to smoothly execute. We appreciate Brian’s many contributions to Intel," said Intel Chairman Andy Bryant.
It will take some time to see how the market reacts, and specifically investors. Shares of Intel initially rose 2 percent following the announcement in premarket trading, but are now down around 1.9 percent.