Tuesday, August 20th 2024
Intel Targets 35% Cost Reduction in Sales and Marketing Group, Bracing for Tough Times Ahead
Intel's Sales and Marketing Group (SMG) has announced a 35% reduction in costs as the company looks to streamline operations and adapt to challenging market conditions. The cuts, revealed during an all-hands meeting on August 5th, will impact both jobs and marketing expenses within the SMG. Intel has directed the group to "simplify programs end-to-end" by the end of the year, a directive that comes on the heels of the company's announcement that it would lay off 15% of its global workforce to save $10 billion in operating expenses. "We are becoming a simpler, leaner, and more agile company that's easier for partners and customers to work with while ensuring we focus our investments on areas where we see the greatest opportunities for innovation and growth," Intel said in a statement to CRN. The company emphasized that this restructuring is about "building a stronger Intel for the future," with partners integral to its plans.
The job cuts within the SMG are expected to target overlapping responsibilities, such as account managers and industry-focused teams, which can confuse customers navigating Intel's complex organization. Additionally, the company plans to significantly reduce its marketing budget and simplify programs, aiming to save at least $100 million in the latter half of 2024 and an additional $300 million in the first half of 2025. The impact will also be felt in Intel's market development fund (MDF), a crucial tool for supporting OEMs and other partners through events, training, and more. An ex-Intel executive warned that the MDF had become vital as the company's product leadership waned, allowing it to maintain valuable relationships with partners. As Intel navigates these changes, its partners are bracing for the impact, with one CEO describing the situation as everyone "hunkering down and just waiting to hear something." Another partner executive expressed concerns about Intel's ability to maintain the level of service and support its customers have come to expect.
Sources:
CRN, via Tom's Hardware
The job cuts within the SMG are expected to target overlapping responsibilities, such as account managers and industry-focused teams, which can confuse customers navigating Intel's complex organization. Additionally, the company plans to significantly reduce its marketing budget and simplify programs, aiming to save at least $100 million in the latter half of 2024 and an additional $300 million in the first half of 2025. The impact will also be felt in Intel's market development fund (MDF), a crucial tool for supporting OEMs and other partners through events, training, and more. An ex-Intel executive warned that the MDF had become vital as the company's product leadership waned, allowing it to maintain valuable relationships with partners. As Intel navigates these changes, its partners are bracing for the impact, with one CEO describing the situation as everyone "hunkering down and just waiting to hear something." Another partner executive expressed concerns about Intel's ability to maintain the level of service and support its customers have come to expect.
45 Comments on Intel Targets 35% Cost Reduction in Sales and Marketing Group, Bracing for Tough Times Ahead
But I think they know the foundry business is the ticket to government interest, so I don't think that would be their best move.
Look, I understand this is a nature of business, but I just love how this reads like poetry, but describes, essentially, just good old fashioned bribes. Amusing, is all, don’t really have anything else to comment on here. And yes, I understand that this isn’t pure bribery… hopefully? Were those “incentives” people like to accuse Intel of providing to OEMs included under MDF?
I miss 3% interest and $2 fuel, not paying for wars or the rest of the world.
Still they are nowhere near in as dire situation AMD was pre 2016 and they turned it around partially thanks to TSMC sure but eventually all these Foundry companies are going to hit a wall.
My understanding is Intel actually wants to get rid of, or scale down, all Groups Not related to a Foundry Business and continue operations in a way TSMC and Samsung Foundries work. Intel top-level executives dream about having NVIDIA, AMD and ARM as primary clients of the Foundry Business.
Intel also has to prove it doesn't have the same issue raptorlake does. Also these cpu's look complicated to make so margins might be pretty low if they price competitively
I'm not an expert on process nodes by any means but Samsung seems way behind both intel/tsmc currently. Maybe I'm wrong but that's the impression I get at least for high powered/high clocking chips.
The Raptorlake degradation issue is huge as they were reluctant to address it until 2 years after the introduction of the product. Client with $30 billion in revenue was the only bright spot in the company and that's where it's getting hit.That's not really true. Alderlake mobile suffered because the battery life degraded significantly compared to predecessor. However during the collapse of revenue it was the Desktop sector which proved to be a bright spot because it took shares away from AMD. It prevented their collapse from being worse.Yea, we're forced to pay all these taxes and work endlessly while all the government has to do is get new supply of paper and run it through it's printers.
Can't believe Intel didn't pay their debt and used it to do share buybacks and dividends. These companies have zero contingency plans.
Yeah it's a shame amd hasn't capitalized on that more a lot of their products haven't been available in volume on laptop for whatever reason.
Still amd was in bad shape in 2014/15 and they still bounced back losing 100s of millions per quarter back then.
Hopefully this is the wake up call intel needs.