Intel to cut thousands of jobs to fund new strategy
US chip pioneer Intel is rumoured to be planning mass lay-offs in an effort to reverse its lost market share.
Bloomberg has spoken to insiders who say the plans could be revealed this week to co-incide with Intel's second-quarter earnings update on Thursday. Intel currently has around 128,000 employees.
This won't be the first time it has trimmed its staff. It cut its workforce by about 5% in 2023, and expected those cost reductions would save as much as USD 10 billion by 2025.
Intel might be the original giant of the microprocessor space, but it has failed to translate its dominance in the PC market to new growth areas such as mobile, data centre and artificial intelligence. Instead, it conceded ground to players such as Nvidia and AMD.
The firm's current CEO Pat Gelsinger is well aware of this, of course. He is spending heavily on research and development aimed at improving Intel’s core technology. He has also overseen a new internal foundry model in which Intel’s internal product groups move to a foundry-style relationship with the company’s manufacturing group. Essentially, it creates an internal market within intel. The firm says this is the most significant business transformation in its 55-year history.
And earlier this year, Intel marked the official launch of its contract chip manufacturing business – Intel Foundry Services – to compete against Asian foundry giants such as TSMC and Samsung. It called the new unit the “world’s first systems foundry” for the AI era.
