Friday, October 28th 2022

Intel Looking to Lay Off Meaningful Numbers of Staff, Can Some Products, After Profit Slump

Oct 28th, 2022 15:31 Discuss (81 Comments)

Intel's third quarter financials that the company released yesterday, weren't exactly what you'd call stellar. This has put Intel CEO Pat Gelsinger in a bind, as he's been forced to announce cost cuts of US$3 billion annually, starting 2023, but that it'll grow to somewhere between US$8 to 10 billion by 2025. Although Gelsinger didn't reveal the specifics of what these cost cuts will entail, he did mention quite a few potentials, according to The Register. Gelisinger stated that Intel "need to balance increased investment in areas like leadership in [technology development], product, and capacity [at new plants under construction] in Ohio and Germany, with the efficiency measures elsewhere as we drive to have best in class structures."

Intel's CFO David Zinsner, told Barron's that the company will be cutting a "meaningful number" of employees from Intel's payroll. Zisner went on to say that Intel will also perform "portfolio cuts, right-sizing our support organizations, more stringent cost controls in all aspects of our spending, and improved sales and marketing efficiency". It sounds like almost no-one is safe at Intel, especially as portofolio cuts mean that some product lines will either be sold off, or simply just canned in favour of more profitable products. Intel is also betting hard on its IDM 2.0 strategy, where the company is decoupling its hardware and software design teams from its foundry business. Time will tell if this helps restart Intel as a business, but Gelsinger seems to believe that the changes he's implementing at Intel will help turn things around.

Sources: The Register, Barrons

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81 Comments on Intel Looking to Lay Off Meaningful Numbers of Staff, Can Some Products, After Profit Slump

#51

TempleOrion

FrickNo it's not. Wealth equals value so more value = more wealth. You're just jealous. Want to have the same wealth? Become a better person and maybe one day you too will be deserving.

It's well known that the hardest working people in the world (the teenage cobalt miners in the DRC) are also the most prosperous and well respected.

#52

Wirko

At that kind of money, Gelsinger has some upgrade path yet to go. But even if he works very hard, he can not overtake the CEO of Qualtrics, an experience management company, one that offers a cloud-based subscription software platform for experience management. That's where the money is, not in stupid products from ... sand.

Just look at this, and pay attention to all the columns in the table, not only the total compensation.
www.equilar.com/reports/95-table-equilar-new-york-times-top-200-highest-paid-ceos-2022

#53

shovenose

I mean sure I’d love to be the ceo of Intel and make that kind of money instead of $22/hr at my day job but whoa why are people so mad he’s making that much money? Like, you can’t boycott every company that makes a lot of money? Who cares? Lol

#54

catulitechup

WirkoAt that kind of money, Gelsinger has some upgrade path yet to go. But even if he works very hard, he can not overtake the CEO of Qualtrics, an experience management company, one that offers a cloud-based subscription software platform for experience management. That's where the money is, not in stupid products from ... sand.

Just look at this, and pay attention to all the columns in the table, not only the total compensation.
www.equilar.com/reports/95-table-equilar-new-york-times-top-200-highest-paid-ceos-2022

Very good date, at simple seek gelsinger gain around 178 millions, 2x compared tim cook of apple with around 98 millions

And curiously huang and su gain around 8x less than gelsinger: lisa su with around 29 millions and huang around 23 millions

:)

#55

TheoneandonlyMrK

Cut back, I don't like the sound of it.
Kinda Bs as others mentioned, share holders eh.
I hope the cuts are mere abrasions.
And those unlucky find greener pastures.

#56

AusWolf

The red spiritThen 1.5 of average company's wage should be just right. Why millions?

That I agree with. Unfortunately, I see most companies pay 1.5x of average wages compared to just one level below on the social ladder. I guess no one would want to be a boss of anyone if it didn't also come with tremendous amounts of money, which shows how corrupt we are as a species.

#57

RandallFlagg

catulitechupVery good date, at simple seek gelsinger gain around 178 millions, 2x compared tim cook of apple with around 98 millions

And curiously huang and su gain around 8x less than gelsinger: lisa su with around 29 millions and huang around 23 millions

:)

Might be because a big chunk of that money was compensating him for what he was losing when he left VMWare, which was alluded to in at least one of the articles referenced in this thread...

By leaving VMWare early he had to leave a lot of money in the form of bonus' and options. Intel had to reimburse him for that.

AusWolfThat I agree with. Unfortunately, I see most companies pay 1.5x of average wages compared to just one level below on the social ladder. I guess no one would want to be a boss of anyone if it didn't also come with tremendous amounts of money, which shows how corrupt we are as a species.

IDK what your experience is, but as an engineer I make about the same as my boss. It's entirely possible, and in fact common, for an engineering manager to 'manage' someone who makes significantly more than them.

What you're describing is probably true of the next higher level and up, i.e. the people who 'manage managers', usually called Directors or Vice Presidents.

#58

AusWolf

RandallFlaggIDK what your experience is, but as an engineer I make about the same as my boss. It's entirely possible, and in fact common, for an engineering manager to 'manage' someone who makes significantly more than them.

What you're describing is probably true of the next higher level and up, i.e. the people who 'manage managers', usually called Directors or Vice Presidents.

I work in logistics, and my experience definitely holds there. That's why almost everybody wants to be a manager without even thinking about the responsibility the role comes with. I earn almost the same as my boss as well, but only because I get a decent night shift allowance while he doesn't.

#59

RandallFlagg

AusWolfI work in logistics, and my experience definitely holds there. That's why almost everybody wants to be a manager without even thinking about the responsibility the role comes with. I earn almost the same as my boss as well, but only because I get a decent night shift allowance while he doesn't.

Well, that is different. For many professional fields you either manage 'systems and equipment' or you manage 'people'.

Hence, there are two paths, but the paths are to some degree equal in terms of pay, to a point. Management jobs in general, IMO based on my observations, are not very secure jobs. For every manager who makes it to director, there's like a bus load of failed unemployed managers.

#60

The red spirit

AusWolfThat I agree with. Unfortunately, I see most companies pay 1.5x of average wages compared to just one level below on the social ladder. I guess no one would want to be a boss of anyone if it didn't also come with tremendous amounts of money, which shows how corrupt we are as a species.

Ain't corrupt at all, just not many people wanting to lead others and not many actually knowing how to do that. Also megacorp like Intel has tons of managers of managers.

#61

TheUn4seen

The red spiritThen 1.5 of average company's wage should be just right. Why millions?

You know what would happen if a CEO earned so little? He would make his millions selling insider information to competitors until said competitors could take the company over. It's the same basic idea with high wages for politicians - they should make enough to not have any incentive for taking bribes. In this case it doesn't work simply because of human nature - greed is a very strong motivator. Corporations try to control it by throwing money at the problem, which is what they usually do because they have a lot of it. My wife is fairly high on the corporate ladder and she freely admits that her wage is several times higher than it should be not because of her professionalism or responsibilities but mostly to disincentivize her from selling what she knows. Confidentiality agreements can be worked around but loyalty can be bought and everyone has his price. Of course, only until someone else gives more...

#62

The red spirit

TheUn4seenYou know what would happen if a CEO earned so little? He would make his millions selling insider information to competitors until said competitors could take the company over. It's the same basic idea with high wages for politicians - they should make enough to not have any incentive for taking bribes. In this case it doesn't work simply because of human nature - greed is a very strong motivator. Corporations try to control it by throwing money at the problem, which is what they usually do because they have a lot of it. My wife is fairly high on the corporate ladder and she freely admits that her wage is several times higher than it should be not because of her professionalism or responsibilities but mostly to disincentivize her from selling what she knows. Confidentiality agreements can be worked around but loyalty can be bought and everyone has his price. Of course, only until someone else gives more...

Doesn't explain why in other industries CEOs are overpaid. Not everything is tech and some industries barely have secrets.

#63

TheUn4seen

The red spiritDoesn't explain why in other industries CEOs are overpaid. Not everything is tech and some industries barely have secrets.

There's a lot more to any company than trade secrets. For example my wife, a financial analyst, could sell the company's client list complete with contract values, accounting details, long term trade agreements, all of the subcontractor and supplier data - and it's probably only the beginning. This would be invaluable to competitors, and she only has general knowledge of their actual products. A CEO has information from every part of the company so his knowledge is much more valuable.

#64

R-T-B

AusWolfDo you think wealth is distributed by what you deserve? What planet do you live on?

Planet "you missed the sarcasm."

I believe I can sum this up as "ya'll got fricked"

#65

AusWolf

The red spiritAin't corrupt at all, just not many people wanting to lead others and not many actually knowing how to do that. Also megacorp like Intel has tons of managers of managers.

I don't think so many people want to lead. I think at least half (but probably more) of the people who aspire to be managers only want it for the money.

Edit: Do you think wanting to lead is a form of corruption on its own? (Rhetorical question)

shovenoseI mean sure I’d love to be the ceo of Intel and make that kind of money instead of $22/hr at my day job but whoa why are people so mad he’s making that much money? Like, you can’t boycott every company that makes a lot of money? Who cares? Lol

No we can't. We must follow the leader and complain about it all the way, like the sheep we are.

#66

The red spirit

AusWolfI don't think so many people want to lead. I think at least half (but probably more) of the people who aspire to be managers only want it for the money.

Edit: Do you think wanting to lead is a form of corruption on its own? (Rhetorical question)

I wonder what does someone like Intel CEO do? After all, he's definitely not crunching numbers, doesn't engineer stuff anymore, I also doubt that he attends IEEE conferences.

For rhetorical question, I guess it depends. It's all about motivation why and then means of exucution, oh and necessity perceived by others of needing a leader.

#67

AusWolf

The red spiritI wonder what does someone like Intel CEO do? After all, he's definitely not crunching numbers, doesn't engineer stuff anymore, I also doubt that he attends IEEE conferences.

He sits with the board of directors to determine paths ahead of the company, make decisions that affect the whole business, talks with suppliers, partners and the media, establish new connections, etc. There's a lot on a CEO's shoulders, I don't doubt that. It's a common working class misconception that managers and directors don't do anything based only on the fact that they can't always be seen from lower levels.

#68

GunShot

AusWolfHe sits with the board of directors to determine paths ahead of the company, make decisions that affect the whole business, talks with suppliers, partners and the media, establish new connections, etc. There's a lot on a CEO's shoulders, I don't doubt that. It's a common working class misconception that managers and directors don't do anything based only on the fact that they can't always be seen from lower levels.

I would also like to add that he has been an executive for decades, but still innovated stuff too. He doesn't need a "Dr" label to show his chip contribution designs over the years.

Just because you are an executive does not STOP a mind with ideas on innovation from solid innovators.

~ Innovating ~ engineers will always have great ideas.

#69

The red spirit

AusWolfHe sits with the board of directors to determine paths ahead of the company, make decisions that affect the whole business, talks with suppliers, partners and the media, establish new connections, etc. There's a lot on a CEO's shoulders, I don't doubt that. It's a common working class misconception that managers and directors don't do anything based only on the fact that they can't always be seen from lower levels.

Many of those directors are also directors of different companies and they decide things together. I don't say that he does nothing, but saying that it's rather easy for him, compared even with other Intelers. I still think that his work is overpaid a lot. The biggest asset of company like Intel is their engineering, but you don't hear about bonuses for engineering department.

#70

ARF

The red spiritI wonder what does someone like Intel CEO do? After all, he's definitely not crunching numbers, doesn't engineer stuff anymore, I also doubt that he attends IEEE conferences.

100% or 99% of the spent time is meetings with zero real contribution on the design and the real work which leads to the physical existence of products.
A company can run without a CEO.

Yeah, mostly strategies - discussions, brain-storming but with bad decisions, etc.
They don't make analysis on what's most optimal and best, but most of the time it's about political decisions and what they want based on some type of fanboyism and perceptions (right or wrong)...

#71

The red spirit

ARF100% or 99% of the spent time is meetings with zero real contribution on the design and the real work which leads to the physical existence of products.
A company can run without a CEO.

Well, no, but many decisions of CEO are actually made or approved by shareholders, then by inter-company agreements, then a bit by local laws and etc. We need CEOs, but it's no secret that their work is very overvalued. I also think that bonus should be given in stocks only, because it encourages CEO to improve performance and shareholders to be stingier about giving up their governing power, so they will only give away shares for truly great CEOs.

ARFYeah, mostly strategies - discussions, brain-storming but with bad decisions, etc.
They don't make analysis on what's most optimal and best, but most of the time it's about political decisions and what they want based on some type of fanboyism and perceptions (right or wrong)...

i disagree, many decisions are very strictly financial only and exactly those things like fanboyism, repuation are the first that are given up on.

#72

ARF

The red spiritWell, no, but many decisions of CEO are actually made or approved by shareholders, then by inter-company agreements, then a bit by local laws and etc. We need CEOs, but it's no secret that their work is very overvalued. I also think that bonus should be given in stocks only, because it encourages CEO to improve performance and shareholders to be stingier about giving up their governing power, so they will only give away shares for truly great CEOs.

i disagree, many decisions are very strictly financial only and exactly those things like fanboyism, repuation are the first that are given up on.

Example of a wrong decision is to buy something from Germany for 2400 and not from China for 300.
This type of political decisions which have zero economic logic and sense.

#73

The red spirit

ARFExample of a wrong decision is to buy something from Germany for 2400 and not from China for 300.
This type of political decisions which have zero economic logic and sense.

Like what exactly?

#74

ARF

The red spiritLike what exactly?

I guess literally everything is cheaper to be bought from China. Chips, cars, any products.
But there are protectionist "laws" between the EU, UK and US - trade agreements? which ignore the economic reality?

#75

The red spirit

ARFI guess literally everything is cheaper to be bought from China. Chips, cars, any products.
But there are protectionist "laws" between the EU, UK and US - trade agreements? which ignore the economic reality?

Because they are countries and not big corps. They have so many other things to care about and reasons for behaviour. Anyway, this is off-topic and not related to CEOs at all.

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Intel Looking to Lay Off Meaningful Numbers of Staff, Can Some Products, After Profit Slump

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