Intel Planning Major Layoffs Amid Slumping Demand Computing Power
October 13, 2022 by Dave Haynes
In another sign of a slowing economy and international trade disputes, giant chipmaker Intel is reportedly planning major layoffs, with as much as 20% of some, or all, staffers at risk of being let go.
That rolls up to a big number, as Intel employs some 120,000 people globally. Bloomberg broke the story (it is paywalled), but Intel has not directly responded. The cuts are expected to be focused on sales and marketing, so 20% of that headcount would be a much smaller number than 20% of the total workforce. Intel has not responded to requests for comment.
From one of many reports picking up on Bloomberg’s story:
The news of layoffs follows a drop in demand for processors for personal computers, or PCs, and an industry-wide sell-off following a spate of new curbs the US has aimed at restricting technology sales to China.
Intel is seeing a dwindling demand for its main revenue driver — PC processors — as competition in this space heats up and rivals like Advanced Micro Devices, Inc. gain market share. Intel lowered its revenue forecast for 2022 from $76 billion in the first quarter of the year, to around $65 to 68 billion in the second quarter, company financials show.
On top of that, tensions between the US and China have spooked the chipmaking industry and have hammered stock prices this week.
On Friday, the Biden administration introduced export controls that will limit the sales of semiconductors made using US technology unless the sellers have an export license. It also added 31 Chinese companies to its “unverified list” in further attempts to hamstring Beijing’s tech development. American exporters will need to conduct additional due diligence before sending goods to companies on the list. The measures will likely make it difficult for Chinese companies to obtain chips built anywhere in the world using US equipment and could hold back China’s own efforts to develop advanced technology such as military weapons.
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