Intel is said to be laying off thousands of employees as PC sales slow | Biden News


Intel had long expected a decline in PC sales after a period of increased demand due to work-and-study-from-home arrangements caused by the COVID-19 pandemic. In July, it admitted Nikkei that it will raise the prices of its processors and other chips due to “inflationary pressures” later this year. It turns out that this might not be the only move Intel is making to cope with the declining PC market. According to BloombergIntel plans to cut thousands of jobs and could make the announcement around the same time it releases its third-quarter earnings report on Oct. 27.

The company lowered its sales and profit forecasts for 2022 in July, when it said it expected revenue for the year to be $11 billion less than previously projected. CEO Pat Gelsinger said during his second-quarter earnings call that the company “will look to take additional actions in the second half of the year” to improve profits. Bloomberg Intelligence analyst Mandeep Singh said the layoffs could reduce the costs Intel incurs to keep the company running by about 10 to 15 percent. Singh also said those costs could be worth at least $25 to $30 billion.

Mobileye, the self-driving tech company that Intel bought for $15.3 billion back in 2017, recently filed for an IPO. Intel intends to keep most of what it earns from the IPO for itself and help finance the chip factories it plans to build. But projected revenues from the proposal may not be enough to prevent the mass layoffs that will affect various divisions within the company. Some groups, such as the sales and marketing department, will reportedly see their numbers reduced by up to 20 percent.

Over the past year, Intel has taken steps to achieve its goal of expanding its foundry. It has earmarked $20 billion to build a massive chip-making facility in Ohio, which it intends to turn into the largest “silicon manufacturing site on the planet.” The company also bought Tower Semiconductor, a chip maker serving customers across industries, for $5.4 billion. There appears to be no indication that those expansion plans are changing, and Bloomberg said that Intel intends to pursue the goals it has set for itself as a leaner company.

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