Report: Intel plans to lay off thousands in workforce amid PC market slowdown
Intel
A Bloomberg reportpublished on Wednesday said that Intel Corp is planning a major reduction in workforce to cope with the slowdown in the personal computer market. The layoffs may be announced within this month around the time of its third-quarter earnings report on October 27, claimed the report citing people with knowledge on the matter.
The report also indicated that Intel’s divisions like sales and marketing could see cuts, affecting at least 20% of the staff. As of July, the company reportedly has 113,700 employees. Meanwhile, the company has declined to comment about the layoffs. The chipmaker has been facing a steep decline in demand for PC processors which is reportedly its main business.
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Intel has also struggled to gain back some market share lost to rivals like Advanced Micro Devices Inc, said the report. Back in July, it also warned that 2022 sales would be at least $11 billion lower than it expected earlier. “We are also lowering core expenses in the calendar year 2022 and will look to take additional actions in the second half of the year,” said Intel CEO Pat Gelsinger, according to the report, regarding the second-quarter earnings call.
Gelsinger also released a memo to the company employees on Tuesday which outlines the plans to create an internal foundry model for external customers and the company’s product lines, said a different report. A foundry business is the one that builds chips that are designed by other companies, however, Intel till now has predominantly built and designed chips so far.
This comes at a time when the company faces intense pressure from investors over profits as Intel’s shares have fallen more than 50% in 2022 with a 20% plunge last month alone. The US-based company has also been trying to retain its position in the market with the release of new PC processors and graphics semiconductors which is reportedly a key part of its strategy to sell more chips to the data-centre market, said the Bloomberg report.
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According to the report, Intel’s chief financial officer, David Zinsner, had also said this after its latest quarterly report, “There are large opportunities for Intel to improve and deliver maximum output per dollar.” He added, the company is expecting to see restructuring changes in the third quarter and also signalled that the cuts are looming, the report indicated. Meanwhile, Google, also unveiled its new Intel-powered tech for server farms that will help speed artificial intelligence tasks, said the report.
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