(Reuters) – S&P Global Ratings on Tuesday downgraded semiconductor maker Intel’s credit rating to ‘BBB’ from ‘BBB+’, citing uncertainty and a slow recovery following a change in management.
S&P Global said the semiconductor manufacturing icon’s sales for the first nine months of this year were roughly flat from a year earlier at $38.84 billion, but were lower than the rating agency expected.
The resignation of CEO Pat Gelsinger, who was a key figure in Intel’s integrated manufacturing strategy, also added uncertainty to the execution of the company’s turnaround plan, according to S&P Global.
“Despite the company’s assurances that its business strategy will remain largely unchanged, some change is still expected under a new CEO, leading to uncertainty about the timing of the turnaround,” the rating agency said. “There is the potential to increase the
Mr. Gelsinger’s resignation comes well before the completion of a four-year roadmap to regain the company’s lead in making the fastest and smallest computer chips, which it lost to Taiwan Semiconductor Manufacturing.
However, S&P Global left the company’s outlook unchanged at “stable,” reflecting the view that Intel will achieve growth following a gradual recovery next year.
(Reporting by Leroy Leo in Bangalore; Editing by Krishna Chandra Elli)
