It’s no secret that Intel is largely on the back foot in terms of cash and chips. After years of financial and market share decline, the company is now slashing its workforce to cut costs. The exact number of jobs affected is unknown but is reportedly in the thousands.
Once the unquestionable manufacturer of the best CPUs on the market, the Intel of today finds itself in a difficult position. Efforts to diversify its manufacturing practices and product portfolio simply haven’t materialised into meaningful profits. Unfortunately, employees will now pay the price of these circumstances.
According to Bloomberg, Intel may announce the reported job losses “as early as this week.” Sources close to the outlet asked to remain anonymous, and the company has repeatedly declined requests from multiple outlets for comment. Intel will share its Q2 2024 earnings on August 1.
During Gelsinger’s tenure as CEO, starting February 15, 2021, Intel stock prices have almost halved from around $57 to just over $30 at the time of writing. This isn’t a huge surprise, given the company’s annual revenue has fallen year-on-year from the end of 2021 onwards.
To Gelsinger’s credit, part of the reason for the company’s bleak financials is due to the huge swathes of cash invested in creating new foundries across the United States. Intel hopes these efforts will see it become the global factory for AI, but how quickly it can realise this potential (if ever) is anyone’s guess. There are still plenty of super loads to transport across the country before any plant opens its doors.
Intel still enjoys a healthy lead in terms of market share, but demand for AMD Ryzen and Epyc CPUs continues to rise. Team Blue faces many challenges across the board, but particularly in the consumer market. Unresolved Raptor Lake instabilities are damaging processors and customer confidence alike, potentially affecting the success of Arrow Lake too.
Job losses won’t solve these long-term problems, serving as a bandage at best for its short-term financials. Not reflected in the penny-pinching is the value of affected employees’ talents. I wish everyone at Intel, both past and present, the very best.