Intel is planning major layoffs due to declining demand for its chips, even as it is on the verge of receiving billions of dollars in funding from the CHIPS Act!
Intel plans major layoffs amid market crisis!
According to Bloomberg News, Intel is planning major layoffs “as early as this month,” around the same time its third-quarter earnings report is set to be announced on October 27.
The staff reductions will be substantial and will hit Intel's sales and marketing team hardest: around 20% of its members are expected to receive dismissal letters.
This decision comes after two years of booming sales during the COVID-19 pandemic, and just as Intel prepares to receive Billions in financing from the U.S. government under the CHIPS Act.
The PC market is currently struggling due to high inflation, New technological restrictions between the United States and Chinaand the Russian invasion of Ukraine.
Gartner recently announced that global PC shipments totaled just 68 million units in the third quarter of 2022, representing a 19.5% drop from the previous year. This was the steepest market decline it has recorded since it began tracking the market in the mid-1990s.
Read more : Intel's Habana Labs cuts more than 10% of its workforce!
On October 11, 2022, Intel CEO Pat Gelsinger Announced a new path to growth during this economic crisis: creating an internal foundry model for external customers and Intel product lines.
Intel will also create an IDM 2.0 acceleration manager under the leadership of Stuart Pann. IDM is short for integrated device manufacturing.
IDM2.0 Intel plans to become a major provider of semiconductor foundry capacity in the United States and Europe to serve customers around the world.
Intel is not the only company that has laid off its employees during this market crisis
Intel would not be the only company to cut jobs. Meta and Microsoft have already announced layoffs. Recently, Meta quietly fired around 12,000 Facebook employees who were “underperforming,” while Microsoft announced in July 2022 that it would lay off nearly 1,800 employees.
Even Sundar Pichai, chief executive of the mighty Alphabet, hinted at the possibility of layoffs, saying he wanted to make Google 20% more efficient and that could include cutting its workforce.
Many other corporations have also been laying off employees amid the global economic slowdown and high inflation fueling recession fears: Tencent, Alibaba, Tesla, Credit Suisse, Goldman Sachs, etc.
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