Sohail Ahmed

Intel will split its vaunted manufacturing unit into three pieces, the company told employees Monday. And Sohail Ahmed, who has jointly led the manufacturing organization since 2016, will retire next month.

The shakeup comes amid a crisis in Intel manufacturing, which is years behind schedule in delivering the company's next-generation, 10-nanometer chip technology. Intel says the chips, originally due in 2015, won't be in mass production until late next year.

The delay reflects the difficulty of shrinking feature sizes on computer chips as those features approach the atomic level. Intel used to introduce a new class of processors on a dependable, two-year cycle, fueling a broad advance in computing power. But its timetable has been slipping amid increasing complexity in the manufacturing process.

With Ahmed's departure, Intel plans to break its technology and manufacturing group into three segments:

Technology development, led by Mike Mayberry, a Hillsboro executive who serves as Intel's chief technology officer and head of Intel labs. Rich Uhlig will run Intel Labs on an interim basis as Mayberry takes on his new role.

Manufacturing and operations, led by Ann Kelleher, another Hillsboro executive who had been running the technology and manufacturing group with Ahmed.

Supply chain, to be run by Randhir Thakur.

They're all under the direction of Venkata "Murthy" Renduchintala, whom Intel hired away from Qualcomm in 2015. He is now president of several Intel businesses, including manufacturing, and the company's chief engineering officer.

Intel declined to elaborate on the changes.

"Sohail has been a great partner and an outstanding role model of Intel values," Renduchintala wrote in a note to employees obtained by The Oregonian/OregonLive. "His dedication, determined manner, focus on data-driven results and unwavering belief in Intel and in our technology have been foundational to the company's growth and success the past three decades."

Ahmed holds the title of senior vice president and general manager of the technology and manufacturing group. He joined Intel in 1984 and works in Hillsboro, where he and Kelleher have run the manufacturing group since 2016.

Retirement "was not an easy decision, but there is never a perfect time to make a change," Ahmed, 60, wrote in a note to colleagues. "It has been a wonderful, exciting and rewarding career for me, far more than I could have ever imagined. I had so much fun and would not trade it for anything else in the world!"

Though Intel's headquarters are in California, its largest and most advanced operations are in Washington County. The company develops each new generation of its leading-edge microprocessors in multibillion-dollar factories on its Ronler Acres campus near Hillsboro Stadium.

Intel employs about 20,000 in Oregon, more than any other business. Many of its top executives work here, too.

The delays in Intel's 10nm rollout result from persistent defects in the chips, reflecting the difficulties in the manufacturing process. Intel insists it will have the new chips out sometime next year, but the delay could enable rivals Advanced Micro Devices and ARM Holdings to gain traction, especially in the lucrative market for data center servers.

"Thanks to the efforts of Sohail and the entire Intel team, we are making good progress on 10nm," Renduchintala wrote to employees Monday. "Yields are improving consistent with the timeline that we shared in April, and we continue to expect systems on shelves for the 2019 holiday season."

Intel has been without a chief executive since June, when Brian Krzanich abruptly resigned after the company uncovered "a past consensual relationship with an Intel employee" in violation of corporate policy. Chief Financial Officer Bob Swan is serving as interim CEO.

-- Mike Rogoway | twitter: @rogoway | 503-294-7699