Intel stock hit the skids after announcing it will slash nearly 17,000 workers and pause its dividend as part of a sweeping cost-cutting plan.
The chipmaker plans to “resize and refocus” its 116,500 workforce in an effort to save $10 billion to combat challenging trends.
Intel shares fell 26% Friday in one of the worst sessions in decades.
“Clearly market conditions, some were good and some not so good, and you have to adjust the financial envelope appropriately,” Gelsinger said in an interview with the Wall Street Journal. “The AI surge was much more acute than I expected, and you have to adjust to those things.”
Demand for AI chips from the likes of Nvidia has shifted away from non-AI products, cutting Intel’s sales by 1% to $12.8 billion. The company lost $1.6 billion compared to a profit of $1.5 billion in the prior quarter.
PROGRESSIVE GROUPS CALL FOR NVIDIA PROBE
The chipmaker’s job cuts come ahead of the widely anticipated July employment report due on Friday. Economists will be watching whether Intel’s cuts are more company specific or related to an industry slowdown.
WHAT IS ARTIFICIAL INTELLIGENCE (AI)?
Intel will suspend its $0.125 per share quarterly dividend in the fourth-quarter but will deliver the payout on September 1 for shareholders of record as of August 7, 2024.
Shares have slumped over 40% this year while the Nasdaq Composite has advanced over 14%.
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Intel CEO says he misjudged the boom that has created a windfall for chipmakers such as Nvidia, that are leading the AI race for next generation technology.
Intel stock hit the skids after announcing it will slash nearly 17,000 workers and pause its dividend as part of a sweeping cost-cutting plan.
The chipmaker plans to “resize and refocus” its 116,500 workforce in an effort to save $10 billion to combat challenging trends.
Intel shares fell 26% Friday in one of the worst sessions in decades.
Ticker Security Last Change Change %INTC INTEL CORP. 21.48 -7.57
-26.06%
“Clearly market conditions, some were good and some not so good, and you have to adjust the financial envelope appropriately,” Gelsinger said in an interview with the Wall Street Journal. “The AI surge was much more acute than I expected, and you have to adjust to those things.”
Demand for AI chips from the likes of Nvidia has shifted away from non-AI products, cutting Intel’s sales by 1% to $12.8 billion. The company lost $1.6 billion compared to a profit of $1.5 billion in the prior quarter.
PROGRESSIVE GROUPS CALL FOR NVIDIA PROBE
Ticker Security Last Change Change %NVDA NVIDIA CORP. 107.27 -1.94
-1.78%
The chipmaker’s job cuts come ahead of the widely anticipated July employment report due on Friday. Economists will be watching whether Intel’s cuts are more company specific or related to an industry slowdown.
WHAT IS ARTIFICIAL INTELLIGENCE (AI)?
Intel will suspend its $0.125 per share quarterly dividend in the fourth-quarter but will deliver the payout on September 1 for shareholders of record as of August 7, 2024.
Shares have slumped over 40% this year while the Nasdaq Composite has advanced over 14%.
GET FOX BUSINESS ON THE GO BY CLICKING HERE
Ticker Security Last Change Change %I:COMP NASDAQ COMPOSITE INDEX 16776.163609 -417.98
-2.43%
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