Intel Corp. plans to cut thousands of jobs as part of a strategy to reduce costs and fund its efforts to recover from a recent earnings slump and market share losses. The reduction in workforce might be announced as early as this week. Intel, which has approximately 110,000 employees (excluding those at units being spun out), is focusing on improving its technology and regaining its prominence in the semiconductor industry.
CEO Pat Gelsinger's Strategy: Intel is heavily investing in research and development to enhance its technology and address its declining market position. Under previous leadership, Intel's dominance was challenged by rivals like Advanced Micro Devices Inc., which gained significant market share.
Current Market Position: Intel is contending with competition from chipmakers like Nvidia Corp., who are advancing rapidly in developing semiconductors for artificial intelligence applications. Additionally, Intel is facing inconsistent demand for its traditional chips used in laptops and desktops.
Recent Changes: Intel reduced its workforce by about 5% in 2023, bringing the total to 124,800 employees by the end of the year. The company aims to save up to $10 billion by 2025 through cost reductions and has been slowing spending in other areas.
New Appointments: Intel recently hired Naga Chandrasekaran from Micron Technology Inc. as the chief global operations officer to oversee the company's manufacturing efforts.
Financial Outlook: Analysts project that Intel will report flat second-quarter revenue compared to the previous year. However, modest growth is expected in the latter half of 2024, with total sales projected to increase 3% to $55.7 billion for the full year—marking the first annual revenue increase since 2021.
Stock Reaction: Intel's shares rose about 1% in late trading, reaching a high of $31.11 on the news of the upcoming job cuts.
The company's focus is on rebuilding its capabilities and market position while navigating a competitive and fluctuating demand environment.
CEO Pat Gelsinger's Strategy: Intel is heavily investing in research and development to enhance its technology and address its declining market position. Under previous leadership, Intel's dominance was challenged by rivals like Advanced Micro Devices Inc., which gained significant market share.
Current Market Position: Intel is contending with competition from chipmakers like Nvidia Corp., who are advancing rapidly in developing semiconductors for artificial intelligence applications. Additionally, Intel is facing inconsistent demand for its traditional chips used in laptops and desktops.
Recent Changes: Intel reduced its workforce by about 5% in 2023, bringing the total to 124,800 employees by the end of the year. The company aims to save up to $10 billion by 2025 through cost reductions and has been slowing spending in other areas.
New Appointments: Intel recently hired Naga Chandrasekaran from Micron Technology Inc. as the chief global operations officer to oversee the company's manufacturing efforts.
Financial Outlook: Analysts project that Intel will report flat second-quarter revenue compared to the previous year. However, modest growth is expected in the latter half of 2024, with total sales projected to increase 3% to $55.7 billion for the full year—marking the first annual revenue increase since 2021.
Stock Reaction: Intel's shares rose about 1% in late trading, reaching a high of $31.11 on the news of the upcoming job cuts.
The company's focus is on rebuilding its capabilities and market position while navigating a competitive and fluctuating demand environment.