Intel mentioned Thursday it plans to slash its headcount to 75,000 by the top of this 12 months, down from 99,500 on the finish of 2024.
The Santa Clara, Calif.-based chipmaker disclosed the layoff objectives because it forecast steeper third-quarter losses than Wall Avenue estimates on Thursday, regardless of anticipating greater gross sales than analysts anticipated whereas new CEO Lip-Bu Tan steers the corporate by way of a historic turnaround.
The outlook comes as buyers pushed Intel’s shares up 14% this 12 months, within the hopes of Tan undoing years of strategic errors which have exempted the corporate from the AI increase dominated by Nvidia.
The corporate mentioned it expects a third-quarter lack of 24 cents per share, steeper than estimates of losses of 18 cents per share, in line with information from LSEG. Intel expects income of $12.6 billion to $13.6 billion for the September quarter, with a midpoint of $13.1 billion that was greater than analysts’ common estimate of $12.65 billion, in line with information compiled by LSEG.
Progress within the PC market is unsure after prospects pulled shipments ahead to the primary half of the 12 months amid ongoing commerce negotiations, analysts have mentioned. Shipments of PCs rose 6.5% within the June quarter in line with information from Worldwide Information Company.
Whereas semiconductors are presently exempt from President Trump’s sweeping international tariffs, Intel and its fellow chipmakers are dealing with prospects who’re reluctant about spending commitments amid widespread macroeconomic uncertainty.
Intel’s second-quarter income for the interval ended June 28 was flat at $12.9 billion, snapping a four-quarter streak of gross sales declines. The consequence beat estimates of $11.92 billion, in line with LSEG information.
CEO Tan has been specializing in a next-generation chipmaking course of known as 14A to win massive exterior prospects, shifting away from 18A, a expertise that his predecessor Pat Gelsinger had spent billions of {dollars} to develop, Reuters has reported.
Tan has additionally targeted on streamlining the group and lowering its workforce. In April, Intel agreed to promote a 51% stake in its Altera programmable chip enterprise for $4.46 billion.
Intel mentioned job cuts contributed to restructuring prices of $1.9 billion within the second quarter.
It recorded June quarter adjusted losses of 10 cents per share, in contrast with estimates of a revenue of 1 cent per share. Its unadjusted loss was 67 cents per share within the second quarter, steeper than analyst estimates of a 26-cent-per-share loss.
