Intel reportedly planning major layoffs, likely to affect thousands of jobs

Intel plans significant job cuts, likely in the thousands, according to a report from Bloomberg News. The workforce reduction is in response to dwindling demand for the company’s consumer chips — part of a broader downturn in the PC market.

The layoffs will hit Intel’s sales and marketing teams particularly hard, says Bloomberg, which affects about 20 percent of team members. The cuts will reportedly be announced “as early as this month,” around the same time as Intel’s third-quarter earnings on October 27. The company currently has 113,700 employees.

After two years of booming sales during the pandemic, the PC market is now struggling. Recent Gartner Analysis found that worldwide shipments totaled 68 million units in the third quarter of 2022 — a drop of 19.5 percent from 2021. Gartner says this is the strongest market decline on record since it entered the market in the mid-1990s to follow.

“This quarter’s results could represent a historic slowdown for the PC market.”

“This quarter’s results could represent a historic slowdown for the PC market,” Gartner chief executive officer Mikako Kitagawa said in a statement. press statement. “Back to school sales ended with disappointing results despite massive promotions and price drops, due to a lack of need as many consumers had bought new PCs in the past two years. On the business side, geopolitical and economic uncertainties led to more selective IT spending, and PCs were not at the top of the priority list.”

Intel addressed these issues in its July second quarter earnings reports. The company said consumer chip sales had shrunk 25 percent by then, while overall sales fell 22 percent. In fact, the company lost half a billion dollars — a 109 percent drop in profits from the $5.1 billion it made in the second quarter of 2021. During the same earnings report, Intel CEO Pat Gelsinger noted that the company “would reduce core spending in calendar year 2022 and will take additional actions in the second half of the year.”

Those “additional actions” now look like they could happen soon.