Intel Said to be Considering Laying Off Thousands of Staff

[TheLostSwede]

The world is without a doubt entering a recession and now the first rumours of mass layoffs in the tech industry are starting. According to Bloomberg, Intel is considering laying off thousands of employees as a measure to cut costs, as its businesses are slowing down. Bloomberg is mainly citing the PC market, which the publication calls Intel's main business, although Intel's Client Computing Group (CCG) does a lot more than just selling PC chips, but the group was Intel's largest source of revenue in Q2 this year by quite some margin. That said, despite a revenue of US$7.7 billion in Q2, this was down 25 percent compared to 2021, which in all fairness was a record year for most companies in the PC industry.

According to Bloomberg, Intel had 113,700 employees as of July this year and the publication said Intel is considering cutting as much as 20 percent of its sales and marketing staff. Bloomberg is expecting Intel to be looking at reducing fixed costs by 10 to 15 percent, although this is unlikely to affect key parts of Intel's business units. Last quarter, most of Intel's business units made a healthy profit, but only the Network and Edge Group had a significant revenue increase over the same quarter in 2021, with most other groups being down significantly. The third quarter results aren't expected to improve upon things, something that appears to be reflected in Intel's share price, which is down over 50 percent in 2022. That said, all of Intel's competitors are in the same boat and it's likely that we'll see more news about companies that are considering trimming back on their expenses and staff numbers in the near future. Intel is scheduled to report its third quarter earnings on the 27th of October.



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[The Quim Reaper]

Cowardly CEO's...always taking the path of least resistance when it comes to keeping those quarterly earnings coming in for the parasite corporate shareholders.

 

[Daven]

I can see the GPU side being placed into stasis. Axe the hardware development and support teams. Keep the software side for continued driver improvements. Then scale back up for Battlemage once the recession ebbs. Something like this might be the source of the contradicting rumors about the cancellation of Arc.

 

[Deleted member 185088]

Probably the GPU division will suffer a lot.

 

[zlobby]

Sales and marketing! Yey!

 

[TheLostSwede]

Sales and marketing! Yey!

Always the first to go.

 

[meatwar]

Sales and marketing! Yey!

No wonder... global crisis on buying power and retail products from manufacturers to double and triple, Intel blame your OEM clients not he the global end user market!!!

 

[Shtb]

Or maybe reduce bonuses for top-managers?
No no no.

 

[DeathtoGnomes]

as usual, corporate lays off the peons when laying off 1 upper management can have the same effect.

 

[agatong55]

Laying off lower staff but still building a fab in Ohio, wonder if this will delay anything.

 

[TheLostSwede]

Laying off lower staff but still building a fab in Ohio, wonder if this will delay anything.

Nah, that money was free from the government...

 

[DeathtoGnomes]

Laying off lower staff but still building a fab in Ohio, wonder if this will delay anything.

Contractors dont get laid off.

 

[Steevo]

Cowardly CEO's...always taking the path of least resistance when it comes to keeping those quarterly earnings coming in for the parasite corporate shareholders.

How dare Chief Executive Officers do what is best for the owners of the company that hired them to do what is best for the company!!! No one should ever do what's best for all those shareholders, as a fact I invest not for retirement but to make sure that people have jobs where they can't be fired and they don't really work for me at all!

 

[Daven]

In addition to the GPU side going into stasis, I can see Intel going to a two year CPU release schedule. AMD has already moved both its CPUs and GPUs to a two year schedule. Nvidia GPUs are on two years. Meteor Lake is already rumored for a 2024 release. With the global economy and fab shrinks slowing down, this makes sense. If this is the case, PC builds/upgrades will last longer with now the best time to do so given new CPUs and GPUs from all companies were just updated.

 

[goodeedidid]

I'm pretty sure they have thousands of marketing employees and sales employes that do nothing all they long. It's pretty good move to slim down a bit and be more effective instead of paying people who in actuality are getting paid for doing nothing really important or effective. It's simple economics, employing more and more people actually hurts efficiency.

 

[TheLostSwede]

In addition to the GPU side going into stasis, I can see Intel going to a two year CPU release schedule. AMD has already moved both its CPUs and GPUs to a two year schedule. Nvidia GPUs are on two years. Meteor Lake is already rumored for a 2024 release. With the global economy and fab shrinks slowing down, this makes sense. If this is the case, PC builds/upgrades will last longer with now the best time to do so given new CPUs and GPUs from all companies were just updated.

It makes sense though, as do we really need incremental upgrades on a yearly basis?
On top of that, it would give them more time to work out their foundry issues.

 

[goodeedidid]

Cowardly CEO's...always taking the path of least resistance when it comes to keeping those quarterly earnings coming in for the parasite corporate shareholders.

I was just going to say that employees who sit in cubicles and do nothing all day long but are getting paid pretty well are like parasites.. lol

 

[TheLostSwede]

I'm pretty sure they have thousands of marketing employees and sales employes that do nothing all they long. It's pretty good move to slim down a bit and be more effective instead of paying people who in actuality are getting paid for doing nothing really important or effective. It's simple economics, employing more and more people actually hurts efficiency.

You've clearly never worked in Asia.

 

[bonehead123]

I agree that there probably quite a few useless, worthless, do-nuthin, overpaid cubicle hounds that should have been gone like yesterday, but there are also way, way too many middle management overlaps at every level, as well as way, way too many upper level execs who make way, way too much $$ in addition to gargantuan bonuses, stock awards, expense accounts, jets, boats, beach houses etc ect.......

If they would just focus on cuts in these areas, they could actually retain and/or hire moar really talented people that could contribute positively to the company & it's goals...

And FYI, this applies to almost every major corporation everywhere, but I digress......rant over, I now take you back to your regularly scheduled TPU postings

 

[Chaitanya]

Or maybe reduce bonuses for top-managers?
No no no.

Gelsinger himself is taking salary north of $150Million/year. Thats worth salaries of hundreds of low ranking marketting staff. Culling his salary alone would save quite a few jobs.

 

[sephiroth117]

I can see the GPU side being placed into stasis. Axe the hardware development and support teams. Keep the software side for continued driver improvements. Then scale back up for Battlemage once the recession ebbs. Something like this might be the source of the contradicting rumors about the cancellation of Arc.

They know it's a long term project and they knew they would never recoup with their capex the first years.

GPU are paramount in datacenters and Intel, gaming/client aside, cannot overlook this...it's a big market

Recession or not, Intel cannot be in "stasis" as they would be crushed by Nvidia and Intel innovations. They have a roadmap, it may be delayed over technical difficulties but I wouldn't bet on GPU activity slowing down for now

 

[Daven]

It makes sense though, as do we really need incremental upgrades on a yearly basis?
On top of that, it would give them more time to work out their foundry issues.

Agreed. I’m tired of incrementalism. Raptor Lake high end is just more of the three C’s (cache, cores and clocks) with the same underlying architecture as Alder Lake. Low end Raptor Lakes are just rebranded Alder Lakes.

 

[AnarchoPrimitiv]

Gotta love the "free market"...at the first inkling of quarterly profits missing their mark, they immediately throw out the work force....more unemployed workers mean people are buying fewer consumer goods in our economy entirely based on consumerism...when they buy fewer consumer goods, the economy takes a down turn and.....you guessed it....more companies immediately throw out the work force....more unemployed workers means people are buying fewer consumer goods....and repeat

Situations like the one demonstrated above are a perfect example of why nationalized, or "state owned" industries, are an excellent bulwark against the cyclical downturns of capitalism. For example, a state owned steel industry can operate with revenues that just cover costs, or even at a loss for a while, so instead of throwing out the work force, they remain employed and therefore still have disposable income to buy consumer goods. Furthermore, the state owned steel industry can keep prices on steel low by running at cost or at a loss and insulate other downstream industries that rely on that steel from the chain reaction caused by economic downturns.

Now instead of steel, imagine if that state owned industry was something even more fundamental to current industrial order: oil.

 

[Daven]

Gotta love the "free market"...at the first inkling of quarterly profits missing their mark, they immediately throw out the work force....more unemployed workers mean people are buying fewer consumer goods in our economy entirely based on consumerism...when they buy fewer consumer goods, the economy takes a down turn and.....you guessed it....more companies immediately throw out the work force....more unemployed workers means people are buying fewer consumer goods....and repeat

Situations like the one demonstrated above are a perfect example of why nationalized, or "state owned" industries, are an excellent bulwark against the cyclical downturns of capitalism. For example, a state owned steel industry can operate with revenues that just cover costs, or even at a loss for a while, so instead of throwing out the work force, they remain employed and therefore still have disposable income to buy consumer goods. Furthermore, the state owned steel industry can keep prices on steel low by running at cost or at a loss and insulate other downstream industries that rely on that steel from the chain reaction caused by economic downturns.

Now instead of steel, imagine if that state owned industry was something even more fundamental to current industrial order: oil.

Corporate responsibility is often ignored by free market ‘enthusiasts.’ The first priority is a stable society. While the best society is a mixture of public and private endeavors (IMHO), failure of any part necessitates shifting the burden to another. This often leads to individual unhappiness as people tend to choose ‘sides’ and protest the shifting power balance.

 

[dragontamer5788]

I'm pretty sure they have thousands of marketing employees and sales employes that do nothing all they long. It's pretty good move to slim down a bit and be more effective instead of paying people who in actuality are getting paid for doing nothing really important or effective. It's simple economics, employing more and more people actually hurts efficiency.

When AMD cut marketing staff back in 2014 or whatever, the AMD lineup immediately became confusing and inconsistent. See Rx 550 vs 580 issues, the drivers, which ones were "rebadges" vs "new Polaris" architecture, etc. etc. Marketing is important. Someone comes up with the names of products and tries to make the lineup easy to understand.

That being said: if we really are entering a recession (I don't think its 100% guaranteed yet, but the signs are pretty bad), then sales will drop, and potentially drop dramatically. Under these circumstances, you need to cut back on products and simplify your lineup. It means that there will be less marketing work to do in general, which inevitably leads to the laying off of marketing staff.

There's a difference. Marketing is important, but only if you actually have products to release. If you're cutting products and cutting costs, marketing inevitably loses "stuff to do" and it only makes sense to cut.