Intel Announces Restructuring Initiative to Accelerate Transformation

[Cristian_25H]

Intel Corporation today announced a restructuring initiative to accelerate its evolution from a PC company to one that powers the cloud and billions of smart, connected computing devices. Intel will intensify its focus in high-growth areas where it is positioned for long-term leadership, customer value and growth, while making the company more efficient and profitable.

The data center and Internet of Things (IoT) businesses are Intel's primary growth engines, with memory and field programmable gate arrays (FPGAs) accelerating these opportunities - fueling a virtuous cycle of growth for the company. These growth businesses delivered $2.2 billion in revenue growth last year, and made up 40 percent of revenue and the majority of operating profit, which largely offset the decline in the PC market segment.



The restructuring initiative was outlined in an e-mail from Intel CEO Brian Krzanich to Intel employees.

"Our results over the last year demonstrate a strategy that is working and a solid foundation for growth," said Krzanich. "The opportunity now is to accelerate this momentum and build on our strengths."

"These actions drive long-term change to further establish Intel as the leader for the smart, connected world," he added. "I am confident that we'll emerge as a more productive company with broader reach and sharper execution."

While making the company more efficient, Intel plans to increase investments in the products and technologies that that will fuel revenue growth, and drive more profitable mobile and PC businesses. Through this comprehensive initiative, the company plans to increase investments in its data center, IoT, memory and connectivity businesses, as well as growing client segments such as 2-in-1s, gaming and home gateways.

These changes will result in the reduction of up to 12,000 positions globally - approximately 11 percent of employees - by mid-2017 through site consolidations worldwide, a combination of voluntary and involuntary departures, and a re-evaluation of programs. The majority of these actions will be communicated to affected employees over the next 60 days with some actions spanning in to 2017.

Intel expects the program to deliver $750 million in savings this year and annual run rate savings of $1.4 billion by mid-2017. The company will record a one-time charge of approximately $1.2 billion in the second quarter.

View at TechPowerUp Main Site

 

[Bansaku]

12,000 layoffs is restructuring for better innovation?

 

[HumanSmoke]

12,000 layoffs is restructuring for better innovation?

Well, if the downsizing is related to withdrawing from stagnant markets then it could well happen. AMD used almost the exact reasoning in the downsizing in 2012

Our restructuring efforts are decisive actions that position AMD to compete more effectively and improve our financial results," said Mr. Read. "Reducing our workforce is a difficult, but necessary, step to take advantage of the eventual market recovery and capitalize on growth opportunities for our products outside of the traditional PC market.

AMD to an extent have transformed themselves in the wake of that restructuring. With Intel's resources and IP, I wouldn't bet against them being able to do likewise - with a considerably higher profit line.

 

[Moofachuka]

so will AMD start looking for Intel's talents? hehe

 

[Fourstaff]

so will AMD start looking for Intel's talents? hehe

Typically the worst workers are let go during downsizing, unless their hands are forced. I don't think AMD will be interested in scraps.

 

[vega22]

depends on who they let go i guess. we all know spite can motivate people plenty to work against someone

but if these guys came from amd in 12?

if anything it seems amd reacted to future trends first, no?

 

[GC_PaNzerFIN]

FACT: 100 000 people had a really shitty work day today despite exceeding all expectations and increasing YoY profit by nearly 20%.

 

[remixedcat]

12,000 layoffs is restructuring for better innovation?

Must have been from the marissa mayer school of corporate... marissa mayer thinks layoffs are "remixes"
I wanna smack her on the head so hard with the purple dildo from GTA SA!!

 

[Prima.Vera]

Typically the worst workers are let go during downsizing, unless their hands are forced. I don't think AMD will be interested in scraps.

Calling people "scraps" and associate the human been as an object.... You my friend would be perfect manager in a multi billion corporation, who doesn't care about anybody and anything, except profit.

 

[Frick]

Calling people "scraps" and associate the human been as an object.... You my friend would be perfect manager in a multi billion corporation, who doesn't care about anybody and anything, except profit.

In the long run it's better for everyone. If they increase profits and manage to keep it up in the coming years they might be so happy as to pay more taxes, not to mention they can lobby for reforms in their industry that will undoubtedly benefit the whole world. With a bit of luck the worst performers in the layoffs will commit suicide, cleaning out the gene pools of tomorrows workers. They might even take their families and friends with them in murder-suicide pacts, which just increases the net profit from a global perspective. And if they are worthy of employment surely they will have no trouble finding it elsewhere. If they choose to not be good enough to get a job, the blame rests on them.

 

[Easo]

I have always been fascinated with the marketing choice of words about layoffs.

 

[remixedcat]

I think more companies need to get out of cali so it's not as expensive for them. srsly talent exists out of cali and a ton of ppl in wv and other states are awesome devs but they can't get jobs. and can't afford to move.

here they can pay a dev 40K a year and it would be a bargain for the co. in cali they have to pay the dev 80-100K/yr for livable wage. for every 1 dev in cali they can pay 3 here! and not have to worry about overseas work with language barriers!

 

[PP Mguire]

Lockheed just did the same thing, I have a feeling that their financial fiscal match up. I'd be willing to bet these people are higher ups that are sitting on fat checks. Wipe out stagnant market fat cats, bring in the lower paid employees to other projects, save money and invest in other areas. Literally the exact same thing Lockheed just did. They mandated 1000 L4-L6 layoffs and gave a voluntary period. If demand wasn't met then they go through starting with L6s and work their way down. Saves a ton of money yearly then they can hire in lower paying employees that do more work.

 

[R-T-B]

Typically the worst workers are let go during downsizing, unless their hands are forced. I don't think AMD will be interested in scraps.

I don't know, AMD might just be interested in scraps if they work for cheap enough at this point...