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Intel Corp. Chief Executive Brian Krzanich today resigned after the revelation that he had a “past consensual relationship” with an employee.

Krzanich (pictured), who had been CEO since May 2013, was replaced by Chief Financial Officer Bob Swan, who is now interim CEO.

Intel said it was recently informed of the relationship, and an “ongoing” investigation by inside and outside legal counsel confirmed a “violation of Intel’s non-fraternization policy,” which it said applies to all managers. It didn’t provide any other details.

A story in the Wall Street Journal over the weekend said the relationship started before Krzanich was CEO and ended several years ago, that the woman involved didn’t work closely with him, and that she still works at the company. The story said the affair was revealed when the woman talked to a colleague, who reported it, triggering Intel’s policy.

“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,” Intel Chairman Andy Bryant said in a statement. “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.”

Intel said its board has a “robust succession planning process in place” and has begun a search for a permanent CEO that includes internal and external candidates. It said it will hire a “leading” executive search firm.

Krzanich also came under fire early this year after it was revealed that he sold nearly 900,000 Intel shares and stock options for about $24 million in November, just a couple of months before Intel revealed a chip flaw called Spectre that it had known about since last June.

Intel has seen some turnover in its executive ranks. In May 2017, just weeks after being appointed president of Intel Corp.’s Data Center Group, longtime Intel executive Diane Bryant said she was taking a leave of six to eight months. Intel attributed the leave to the need for Bryant to tend to an unspecified “personal family matter,” and a spokesperson declined to provide additional details. But by last November, she was appointed chief operating officer of Google LLC’s cloud operation.

Krzanich’s resignation comes as a surprise, at least to those outside the company. Krzanich was featured in December on the cover of Forbes magazine as the CEO of the top-ranked company on its new list of the “Just 100 top corporate citizens.”

Some outside observers said Intel might benefit from some new leadership. “Odd way for this whole thing to go down, but Intel is in desperate need of new management right now,” tweeted Ben Bajarin of the market research firm Creative Strategies Inc. “They have moved from leader to follower and have a small window to course correct as disruption is looming at their doorstep.”

In the same announcement today, Intel said expects a “record second quarter” that ends June 30 and will be reported July 26. It expects revenue of about $16.9 billion and earnings per share before certain costs such as stock compensation of about 99 cents. “With accelerating data-centric revenue, the company is off to an excellent start in the first half of the year and expects 2018 to be another record year,” the company said in a statement.

However, Intel generally has been struggling with a broad industry turn away from personal computers to mobile phones as a driver of innovation and revenue, and the company missed the move to mobile under previous CEOs in the 2000s, Paul Otellini and Craig Barrett. It has had more success with powerful chips for data centers, where it’s dominant, but even there, it’s facing more competition from the likes of Nvidia Corp., whose graphics chips lately have been embraced for artificial intelligence and analytics workloads. Earlier this month, Intel also signaled that it would start making its own graphics chips starting in 2020.

Under Krzanich’s reign, Intel made some high-profile acquisitions of chip technology companies such as Mobileye NV for $15.3 billion in 2017 and both Movidius Ltd. for $400 million and Nervana Systems for $350 million in 2016. In 2015, it spent $16.7 billion to buy Altera Corp., whose programmable chips it’s also pitching for AI and machine learning work.

Charles King, president and principal analyst at Pund-IT Inc., said he doesn’t think Krzanich’s departure will disrupt Intel’s plans. “At heart, Intel is an innovative manufacturing company that largely proceeds in a highly deliberate manner,” he said. “You don’t invest billions on a new fab or in new markets at the drop of a hat.”

Still, Bajarin added that more changes could be coming for Intel, or at least are needed. He called Intel’s 10-nanometer chipmaking process a “hot mess and everyone I know there working on it agrees. Anyway you slice it, they need to shed fabs soon.” But he added, “Just being a data company and client being much smaller makes Intel a smaller company in the future.”

Patrick Moorhead, president and principal analyst at Moor Insights & Strategy, said he agrees with Intel’s strategy to diversify from PCs and noted that it’s a player in growth segments such as 5G, self-driving cars, the “internet of things” and AI.

It’s not yet clear who Intel is likely to choose as the new CEO, but analysts already are handicapping the odds.

“If Intel hires from within, it will likely be Murthy Renduchintala [group president of the Technology, Systems Architecture & Client Group and chief engineering officer] or Navin Shenoy [executive vice president and general manager of the Data Center Group], but more than any time, I wouldn’t be surprised if the company went external,” Moorhead said. “Intel has a huge swath of very qualified candidates, but many times, this comes down to external optics.”

Intel’s shares were down nearly 2 percent in early trading today, a mild reaction on a down day for the overall market.

Swan has been Intel’s CFO since October 2016 after nine years as CFO of eBay Inc. Earlier, he was CFO of Electronic Data Systems Corp. and TRW Inc. and also once was CEO of the failed dot-com-era delivery service Webvan Group Inc.

With reporting from Paul Gillin

Photo: Robert Hof/SiliconANGLE