Enlarge /. Bob Swan, Intel's Chief Executive Officer, during an Intel press event for CES 2020 at the Mandalay Bay Convention Center on January 6, 2020 in Las Vegas, Nevada.

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Intel is replacing its CEO, Bob Swan, after a series of manufacturing setbacks and competitive mistakes that have lost the veteran Silicon Valley company as the leading US chipmaker.

Swan, his former CFO, who held the top position for a little over two years, will be replaced on February 15th by former Intel veteran Pat Gelsinger, who is currently CEO of VMware, the infrastructure software group.

The company took the move just days before Mr. Swan was expected to present Intel's new manufacturing strategy along with the company's latest results.

Last July, Intel was overtaken by Nvidia as the most valuable chip maker in the United States after delaying its next generation of chips due to manufacturing issues. Since then, Swan has been under pressure to decide whether Intel would continue to invest in chip manufacturing to compete with its rivals TSMC and Samsung, or whether to outsource more production to them.

Intel's shares rose more than 12 percent to $ 59.51, giving activist investor Third Point, who took a stake last month and publicly made change, a quick return when Intel shares fell below $ 50. Dollars were traded.

"Swan's a class and did the right thing for all of the stakeholders who stood by Gelsinger's side," Third Point founder Dan Loeb said in a Twitter message after CNBC first reported the news.

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Gelsinger previously worked for Intel for 30 years, including as Chief Technology Officer, before moving to VMwar & # 39; s former parent company EMC a little over a decade ago.

“Pat is a proven technology leader with a remarkable track record of innovation, talent development, and deep understanding of Intel. He will continue a values-based approach to cultural leadership with a hyper-focus on operational execution, ”said Omar Ishrak, independent chairman of the Intel board of directors.

"I am delighted to be able to rejoin and drive Intel back at this important time for the company, our industry and our country," said Gelsinger.

Intel had lost around $ 60 billion in market capitalization in 2020. The biggest shock came in July when its shares fell 17 percent in a day after it was revealed that development of new process technology for making the latest generation of chips was 12 months behind schedule.

Swan, a former eBay executive, was promoted in January 2019 after Brian Krzanich resigned, who had not disclosed an affair with another employee.

Swan had made a commitment to making data rather than PCs a strategic focus for Intel as the tech industry's growth engine shifted to cloud computing. Ishrak said Wednesday that Swan "made significant contributions to Intel through this phase of transformation."

However, Apple's announcement in mid-2020 that it would switch its Macs from Intel to an ARM-based processor of its own design showed that Intel was still facing stiff competition.

Nvidia's proposed $ 40 billion acquisition of Arm, the UK chip maker whose design powers the vast majority of mobile devices, will only add to the pressure on Intel.

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