Intel's Cost Reduction Strategy and Market Challenges

Intel to Cut Thousands of Jobs for Cost Reduction

Intel Corp. is planning to eliminate thousands of jobs in an effort to reduce costs and finance a strategy to bounce back from a decline in earnings and market share . The workforce reduction is expected to be announced soon , with Intel currently having around 110,000 employees , excluding those at spun - out units . Chief Executive Officer Pat Gelsinger is investing heavily in research and development to enhance Intel 's technology and regain its position in the semiconductor industry , which has been challenged by competitors like Advanced Micro Devices Inc. Intel 's shares saw a 1 % increase in late trading on the news.

Challenges Faced by Intel in Semiconductor Industry

Intel has been facing challenges in the semiconductor industry , with other chipmakers like Nvidia Corp. making significant advancements in developing semiconductors for artificial intelligence - related tasks . The company is also dealing with fluctuating demand for chips used in laptops and desktop computers , its primary business area . Gelsinger is optimistic about Intel 's ability to enhance its technology and has initiated a plan to construct factories for manufacturing semiconductors for other chipmakers . The company previously reduced its workforce by 5 % in 2023 and expects cost reductions to save up to 0 billion by 2025.

Financial Projections and Expectations for Intel

Analysts predict that Intel 's second - quarter revenue will remain flat compared to the previous year , with a modest growth anticipated in the second half of 2024 . Total sales are expected to increase by 3 % to 5.7 billion for the full year , marking the first annual revenue growth since 2021 . The company is set to report its second - quarter earnings soon , and the announcement of job cuts is part of its strategy to navigate the challenging landscape of the semiconductor industry.

In conclusion , Intel 's decision to reduce its workforce is a significant move in its efforts to cut costs and drive growth in the face of market challenges . The company 's focus on research and development , along with strategic investments in technology , aims to position Intel as a competitive player in the semiconductor market.