2023-05-08 12:56:00
Intel had one of the worst financial results in its entire history in the first quarter of 2023, recording a loss of $ 2.8 billion. As an effect of the deficit, this Monday (08), a spokesperson confirmed that the company will carry out a drastic cost cut which, according to analyst Dylan Patel, could impact 20% of employees.
Amidst the unfavorable macroeconomic scenario, a representative of the hardware giant told the site Tom’s Hardware that the company is “focused on identifying cost reductions and efficiency gains through multiple initiatives, including some targeted workforce reductions” across its specialist groups.
The spokesperson did not detail the number of employees who are expected to be released or which divisions will be impacted. Dylan Patel says that the Client Computing Group (the arm focused on consumer products, including Intel Core and Arc) and the Data Center and AI Group (the group for data centers and AI) would take a 10% budget cut.
Intel reiterates its commitment to “critical areas” for its business, but in its statement, the company cites manufacturing operations subsidized by the US government under the Chips Act, which provides for an investment of US$ 52 billion to bolster the semiconductor sector in the country and compete with China.
We continue to invest in areas critical to our business, including our US manufacturing operations, to ensure we are well-positioned for long-term growth. These are difficult decisions, and we are committed to treating affected employees with dignity and respect.
Intel
The new wave of layoffs comes after a series of discontinued projects. In the last year, Intel ended the operations of Optane memories, a technology that promised to multiply the performance advantages of SSD and RAM, registering millionaire losses. As early as 2023, the manufacturer sold its 5G modem business to MediaTek.
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The initiatives were part of IDM 2.0, its long-term strategic plan that targets fully integrated manufacturing for advantages against other industry giants such as Samsung and TSMC. To achieve this new business model, the company carried out a series of cuts in divisions that would not fit into its future.
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