Intel job cuts to affect 20% workforce; layoffs start in October 2022: Report
1 min read 12 Oct 2022, 07:22 PM ISTSeveral of Intel's businesses, especially the sales and marketing sector, may suffer layoffs affecting about 20% of the workforce.
PremiumIn response to a slowdown in the personal computer industry, Intel is considering a significant decrease in staff, possibly numbering in the thousands, according to a report by Bloomberg News on October 11. As early as October, several of Intel's businesses, especially the sales and marketing sector, may suffer layoffs affecting about 20% of the workforce, according to Bloomberg sources. Intel has chosen not to comment on the layoffs.
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People now spend less on PCs than they did during the pandemic-related lockdowns due to decades-high inflation and the reopening of offices and schools. Additionally, COVID-19 limits in China, a significant PC market, and the unrest in Ukraine, which has hindered supply chains and weighed on demand, are placing pressure on chipmakers.
The company cut its year sales and profit goals in July after its second-quarter performance fell short of expectations. In a statement distributed to staff on October 11, Intel CEO Pat Gelsinger outlined intentions for building an internal foundry model for the company's product lines and external clients.
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Taiwan Semiconductor Manufacturing Co. is the market leader in the foundry industry, which produces chips that are designed by other businesses. So far, Intel has primarily produced semiconductors that it has created.
A more general slowness is now making those difficulties worse. The decline in IT investment is affecting Intel's PC, data centre, and artificial intelligence businesses, which is hurting revenue and earnings. Comparing the third quarter to the previous year, PC sales fell 15%.
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According to Bloomberg Intelligence analyst Mandeep Singh, Intel may need to explore a dividend reduction to counteract declining demand and stagnant PC prices. However, he suggested that Intel's intention to issue shares of its Mobileye self-driving technology company in an IPO may allay those worries.
Making layoffs now is particularly uncomfortable for Intel. The company actively promoted a $52-billion chip stimulus plan in 2022, aiming to boost US manufacturing. The largest chipmaking hub in the world will be relocated to Ohio.
(With agency inputs)
