Intel Corp. could lay off thousands of workers by the end of the month, around the same time the chip maker reports quarterly results in a difficult year for semiconductor manufacturers, according to a report late Tuesday.
Layoffs will be announced “already this month,” Bloomberg reported, citing unidentified sources who are described as knowing the cuts are coming. Intel INTC, -0.63% has approximately 121,100 employees worldwide. While the report didn’t include geographic specifics regarding the targeted jobs, it said sales and marketing departments could see a headcount reduction of up to 20%.
The last time Intel laid off a significant number of employees was in April 2016, when the Santa Clara, California-based chip company announced it would cut 12,000 jobs, or 11% of its workforce, on the same day it reported quarterly results.
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Intel plans to report its third quarter results on October 27. Analysts expect earnings of 34 cents on revenue of $15.43 billion based on Intel’s forecast of approximately 35 cents per share and $15 billion to $16 billion in revenue. In the year-ago quarter, Intel reported earnings of $1.71 per share on revenue of $19.19 billion.
Since Intel Chief Executive Pat Gelsinger took over in early 2021, he has had an uphill battle to return the company to its former glory as a leading chip maker.
That means building out the company’s manufacturing capacity, which, while a popular idea amid a global chip shortage, has come under criticism because the multi-year plan not only weighs heavily on margins and profitability, but comes at a time when demand for PCs is strong. decreased.
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Last year, Gelsinger defended his capital plan, promising margins would remain “comfortably above 50%,” a promise that milk loved nine months later, as a challenging 2022 narrowed margins to about 45% in the second quarter.
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