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Intel decimates staff - will fire 12,000

by on20 April 2016

Reduce dependence on PCs

Intel has decided that there is no point waiting for the PC to return and is decimating its staff and getting into something else more lucrative – cloud computing and the Internet of thing.

Intel says that this glorious restructuring means that 11 per cent of its workforce,  or 12,000 people will be in other jobs by next year, or sitting on a street corner with a dog on a string, twanging an out of tune guitar.

Intel CEO Brian Krzanich said these sorts of changes are not something Intel was taking lightly.

“Acting now enables us to increase our investments in areas that are critical for our future success. This is a comprehensive initiative. We will emerge as a more collaborative, productive company with broader reach,” he said.

But the programme Intel has lined up for itself is somewhat strange.  It is basically doing the same thing that IBM did – get out of its traditional markets and get into the cloud and more mobile formats like the Internet of Things. The downside of this is that these are areas where other companies are doing well and Intel has not managed to enter. 

Krzanich said that Intel has to move from client-centric to a company that focuses more and more on a broader set of products — the cloud and all the connected devices that connect to that cloud and the connectivity that brings those devices to the cloud. That includes the PC but it’s much more.

“We’ve made enough progress now to “push the company all the way to this transformation.”

Intel expects the program to deliver $750 million in savings this year and annual run rate savings of $1.4 billion by mid-2017. The company will record a one-time charge of approximately $1.2 billion in the second quarter.

The majority of affected employees will be informed within 60 days with all the job reductions completed by mid-2017, according to the company.

Last modified on 20 April 2016
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