As shown by several reports in recent months, the PC market is slowing down in 2022 as compared to the previous year. Intel, who is, among others, apparently cutting tens of thousands of jobs to minimize revenue losses.
Intel to lay off employees this month
Intel is planning a major increase in headcount, according to reports that the number of employees laid off could reach thousands. While the news hasn''t been confirmed, Bloomberg says the relays will be announced any day now.
Intel employs around 113,700 people. According to a survey, the divisions most affected by the cuts will be sales and marketing, which will be reduced by 20% on October 27. The company will now release its third quarter earnings report, allowing it to cut headcount before then.
In 2016, the first time Intel made a significant employee reduction, which resulted in an estimated 12,000 people being laid off.
Intels revenue is expected to decrease 15% in the third quarter, as do the company''s profit margins. Earlier this year, the chipmaker said sales will be $11 billion lower than anticipated. A report from IDC said the PC market fell 15.3% year on year to 71.3 million units in Q2 2022.
Although the decline in the PC market is the main reason why Intel is losing money, the chipmaker also lost market share to AMD, its main competitor in 2020. As a result, the chipmaker lost Apple as one of its biggest customers, as the Cupertino-based company decided to include its own Apple Silicon chips inside Macs.
While Intel is attempting to reclaim market share with its chips, it is also investing in artificial intelligence services and data centers. Intel is also reportedly working with TSMC to develop chips using the same 5-nanometer technique used for Apples M1 chips.
In 2018, the chipmaker sold its modem division to Apple for $1 billion. However, it is unclear if all of this will help keep the company back on track.
Other companies like Oracle and Arm have also reduced their positions. Although these are difficult times for everyone in the computer industry, Intel appears to face even more difficulties than its competitors.