Intel is a company that makes microprocessors for computers and for other devices. The company has announced layoffs following disappointing earnings.
Intel cuts 12% of its workforce
This week, Intel announced its plans to cut 12% of its employees. The cuts are part of a restructuring plan that will allow it to make up for revenue shortfalls and boost profits.
The company stated, “We are committed to becoming more competitive against our peers in the industry and we see essential steps forward as investing in data centers and growth businesses like memory.”
However, analysts expect these cuts won’t be enough for Intel if it wants to remain competitive with other chipmakers such as NVIDIA Corp. (NVDA) and AMD Inc. (AMD).
Layoffs elsewhere too
- Layoffs are not a new phenomenon.
- Layoffs can be a good thing if they result in better productivity and higher profits, but that’s not always the case.
- The fact that layoffs are happening at other companies is indicative of the fact that companies must adapt to changing markets and economies.
Intel will cut 12% of its workforce because it is not making enough cash
- Company laying off 12% of its workforce as a result of losing money and market share to competitors.
- Intel has been losing money in recent years, due in part to an inability to compete with competitors who are able to produce chips at a lower cost.
- The company is looking for ways to cut costs while remaining profitable and competitive.
Self-driving cars, internet of things.
They want to expand their business. To do so, they plan to focus on:
- Artificial Intelligence (AI),
- Self-driving cars,
- And the internet of things — an area where they’ve been working with BMW and Tesla.
They want to make chips for self-driving cars that will be able to detect objects in real-time and teach themselves how to react appropriately.
The job cuts are part of a restructuring plan
They are restructuring its business to focus on core segments, such as the Internet of Things (IoT), servers, self-driving cars, and robotics. The company expects to save $750 million per year by cutting jobs in administrative and support areas.
The company plans to invest in 5G wireless technology. This allows for faster network speeds and lower battery consumption than previous generations of wireless technology.
Intel is broadening its offering to include more chips for robotics, self-driving vehicles, and the IoT. The company is making a big push into the market for chips that are being used in self-driving cars. Intel’s acquisition of Mobileye was announced, and the company will begin mass production of Mobileye’s EyeQ5 chip.
Intel has announced that it will lay off workers worldwide as part of a major restructuring of its business
The company is cutting back in areas where growth has been slow and doesn’t see a turnaround any time soon. In the past, Intel has made big bets on new technology like 5G and AI, but those products haven’t taken off yet with consumers or businesses.
The chipmaker is also close to completing a deal with AMD to acquire its graphics chip unit for $1.5 billion — a move aimed at allowing Intel to make integrated chipsets that combine both CPU and GPU components into one package instead of relying on third-party suppliers like Nvidia or AMD (Advanced Micro Devices).
These cuts are meant to get the company back on track and generate the highest profits for Intel.
Intel cutting jobs as a result of low profits. The company has broadened its offering to include more chips for robotics, self-driving vehicles, and the IoT. Intel Corp is cutting jobs worldwide to refocus its business as it adapts to a world where personal computer sales are in decline.
The California-based chipmaker said Tuesday that the cuts in the workforce will save about $1 billion annually. It also plans to eliminate overlapping positions within engineering teams. They’re attempting to improve efficiency across business units from research and development through manufacturing operations.
The company is changing the way it does business and focusing on the areas that bring in profits. This will mean cutting jobs and moving resources to other areas that are profitable for Intel.
Written By Agustin Perez
Sources
FastCompany: Intel layoffs loom: Chipmaker reportedly plans to make its biggest job cuts in years
Yahoo: Intel will reportedly lay off thousands of employees as PC sales slow
Barrons: Layoffs at Intel Could Spell a Bitter Winter for Tech Stocks. It’s Not All Bad News.
Top Image/Featured Image Courtesy of Takuya Oikawa Flickr Page Creative Commons License
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