US chipmaker giant Intel Corp is reportedly planning a major reduction in headcount, likely numbering in the thousands, to cut costs and cope with a steep decline in demand in the personal computer market.
The layoffs will be announced as early as this month, with the company planning to make a move around the same time as its third-quarter earnings report release on October 27th, as per Bloomberg. The chipmaker giant had 113,700 employees as of July 2022.
Intel had in July already slashed its annual sales and profit forecasts after missing estimates for second-quarter results.
This comes amidst decades-high inflation and the reopening of offices and schools leading people to spend less on PCs than they did during pandemic-induced lockdowns.?Chipmakers are also reportedly under pressure from COVID-19 curbs in key Personal Computer (PC) market,?China,?and the Ukraine conflict that has led to supply-chain snarls and also weighed on demand.
Indicating new plans to boost business, Intel's CEO Pat Gelsinger had released a memo to company employees yesterday, outlining plans to create an internal foundry model for external customers and the company's product lines. A foundry business builds chips that other companies design and Taiwan Semiconductor Manufacturing Co is the top player in that space. Intel has mainly built chips it designed itself so far, as per the report.?
If the layoffs at Intel happen, it will join tech giants such as Meta and Microsoft in announcing the job cuts amid an economic slowdown. Meta is said to have been ¡®quietly¡¯ laying off around 12,000 ¡®underperforming¡¯ Facebook employees recently, while Microsoft had announced in July 2022 that it had laid off nearly 1800 employees amid restructuring.
Besides these two tech giants, Google and?Alphabet CEO Sundar Pichai also hinted at the possibility of layoffs. Last month, speaking at Code Conference in Los Angeles, Pichai said that he wants to make Google 20% more efficient and that could include headcount cuts, i.e. layoffs.
And that¡¯s not all. Many other giant organizations have been laying off employees, including Ford, Tommy Hilfiger and Calvin Klein owner PVH Corp, Tesla, Goldman Sachs, Credit Suisse, Tencent, Alibaba etc.?
All this comes amidst economic slowdown, high inflation and growing recession fears, with the IMF and World Bank?warning about the latter hitting the global economies in 2023.?
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