Grove Quits as Intel CEO

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SANTA CLARA, Calif.: Andrew Grove has resigned as CEO of microchip giant Intel, and will be replaced by his No. 2, Craig Barrett, it was announced this morning. Grove, who is battling prostate cancer, will stay on as chairman. "I would like to focus more of my time on broad strategic issues concerning the industry and Intel," he said in a statement. Wall Street was unfazed by the news as Intel stock rose $1 in midday trading, and the company said it would increase its stock buyback plan by 100 million shares to 129.8 million.

“Intel is at a crossroads right now,” says TIME Business correspondent Daniel Kadlec. “Their stock is down; their margins are down and competition from cheaper chip manufacturers is up. It’s not a bad time to turn over the reins, because the company is having to adapt itself to new business environment.”

Grove, who was TIME's Man of the Year in 1997, worked at Intel from the corporation's founding in 1968, and became CEO in 1987. When Barrett, who had overseen much of Intel's product development over the past decade, was made president in 1997, it was widely speculated that he was being groomed as Grove's successor.