Intel plans biggest layoffs 15% of its workers. That means 15,000 people will lose their jobs. The company told its employees this on Thursday. This is part of a plan to save $10 billion by 2025. This comes after a bad second quarter for the company.
CEO Pat Gelsinger spoke to workers in a memo. He said, “Our revenues did not grow as expected. We have not fully used trends like AI. Our costs are too high. Our margins are too low so we need to bring layoffs. We need big changes. Our financial results and future outlook are worse than expected.”
Intel has struggled with AI compared to other companies. Companies like Nvidia have done better. Intel was a leader in CPU chips 25 years ago. But it has been slow with new tech like smartphones and AI. Intel’s annual revenues fell $24 billion from 2020 to 2023. Yet, its workforce grew by 10%. That is why they planned the layoffs to generate better revenues. Other chipmakers have seen big growth in revenues and value.
Intel’s revenue dropped 1% in the second quarter. This is compared to the same time last year. The company blamed this on problems with its AI PC products. Intel will stop its shareholder dividend starting in the fourth quarter of 2024. It expects more hard times ahead.
Intel will offer a “voluntary departure” program next week. This is for employees who choose to leave before the layoffs. The company will also offer a better retirement package for eligible employees.
To read our article about “Gaming PC with Intel Core Ultra processor and an RTX 4060” click here.
