Intel is planning major layoffs of its staff, due to declining demand for its chips, even as it is set to receive billions in funding from the CHIPS Act!
Intel Planning Major Layoffs, Amid Market Downturn!
According to Bloomberg News, Intel is planning major layoffs of its staff, “as early as this month” – around the same time its third quarter earnings report is announced on October 27.
This reduction in headcount will be substantial, affecting Intel sales and marketing team the hardest – around 20% of their members are expected to receive pink slips.
This decision comes after two years of booming sales during the COVID-19 pandemic, and just as Intel is set to receive billions in funding from the US government under the CHIPS Act.
The PC market is currently struggling due to high inflation, new US-Chinese tech restrictions, and the Russian invasion of Ukraine.
Gartner recently announced that worldwide PC shipments only totalled 68 million units in the third quarter of 2022 – a 19.5% drop from a year ago. This was the steepest market decline it recorded since it started tracking the market in the mid-1990s.
Read more : Intel’s Habana Labs Cuts Over 10% Of Workforce!
On October 11, 2022, Intel CEO Pat Gelsinger announced a new path for growth during this economic downturn – the creation of an internal foundry model for external customers, and Intel product lines.
Intel will also create an IDM 2.0 Acceleration Officer under the leadership of Stuart Pann. IDM is short for Integrated Device Manufacturing.
IDM 2.0 is Intel’s plans to become a major provider of semiconductor foundry capacity in the US and Europe to serve customers globally.
Intel Not Alone In Layoffs During This Market Downturn
Intel wouldn’t be alone in cutting jobs. Meta and Microsoft had already announced layoffs. Meta quietly laid off about 12,000 “underperforming” Facebook employees recently, while Microsoft announced in July 2022 that it laid off almost 1,800 employees.
Even Sundar Pichai – the CEO of mighty Alphabet hinted at the possibility of layoffs, saying he wanted to make Google 20% more efficient and that could include cutting its headcount.
Many other corporations have also been laying off employees amidst the global economic slowdown and high inflation that is fuelling recession fears – Tencent, Alibaba, Tesla, Credit Suisse, Goldman Sachs, etc.
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