Home Gaming Intel lays off 12 000 staff as declines in PC market loom large

Intel lays off 12 000 staff as declines in PC market loom large

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Intel suffers massive layoffs in restructure

Intel is, without a doubt, the leader when it comes to the production of CPUs around the world. If you’re building a PC, it’s extremely likely you’ll be “powered by Intel”, with the company delivering iteration after iteration of desktop and mobile CPUs to keep the PC market driving forward. It is certainly not their own thumb in the business pie, and a forecasted decline in the PC market has Intel back into a corner. A corner which is forcing them to let go of 12 000 employees globally.

Layoffs of even just a few thousand are disastrous, so 12 000 people suddenly losing their jobs is heart-breaking news. Intel is implementing the voluntary and non-voluntary retrenchment as part of an on-going restructure within the company. Intel CEO Brian Krzanich attributed the forceful losses to a decline in the PC market, while he continues to reshape Intel into “a company that powers the cloud and billions of smart, connected computing devices” rather than just a PC one.

That means a larger focus on departments and technologies like Data Centres, The Internet of Things and Cloud Computing, which make sense given Intel’s market forecasts. CFO Stacy Smith believes now that the PC market will decline by high single digit percentages as opposed to older forecasts predicting much lower, which has strong-armed Intel into the decision. The 12 000 employees make up over 10% of Intel’s global workforce, making it clear that Intel isn’t sitting on their hands while the market shifts around them.

The implications of this and their new focus have yet to really trickle down to the consumer level, but it’s a massive dynamic change nonetheless. If Intel is going all in on departments that don’t really include providing for consumer products like desktops and laptops, we could see the cycle of architecture advancements slow down even more over the coming years. That will undoubtedly have a knock on effect, given that Intel is the leader in CPU production globally now anyway.

We’ll just have to wait and see how this all plays out over the coming months.

Last Updated: April 21, 2016

24 Comments

  1. I’m sure the Intel CEO is crying himself to sleep at night with the nice fat stock bonus he’ll get for streamlining the company and positioning it for future growth. Or whatever his preferred euphemism is for getting rid of those faceless numbers in his heartfelt email to them.

    Reply

    • Greylingad[CNFRMD]

      April 21, 2016 at 12:14

      Which goes something by the likes of:
      “Dear valued employee,

      blah blah blah fired blah blah, to not come in to work tomorrow, blah blah, no severance package if you plan to stay, blah blah.

      Yours sincerely,

      The guy who is transported by helicopter to avoid losses in capita.”

      Or is that too much?

      Reply

      • HairyEwok

        April 21, 2016 at 12:44

        *Golden diamond encrusted helicopter.. There fixed it now it’s right.

        Reply

        • Greylingad[CNFRMD]

          April 21, 2016 at 12:49

          You mean Airwolf?

          Reply

          • Greylingad[CNFRMD]

            April 21, 2016 at 12:58

            Because…
            http://i.imgur.com/eRkqOMR.gif
            Dum, dum dum dum dum , dum dum dum dum, dum dum dum dum, dum, de dum, dum , dum de dum de dum…

          • Admiral Chief in New York

            April 21, 2016 at 13:31

            EPIC

          • Greylingad[CNFRMD]

            April 21, 2016 at 13:54

            Stringfellow Hawk!

    • miaau

      April 21, 2016 at 13:01

      sad.

      I have, however, been through company downsizing, where certain people are given packages to save the rest of the company. Hard. Harsh. Sad. Reality. Still harsh.

      Reply

      • Alien Emperor Trevor

        April 21, 2016 at 13:14

        We’ve been through it 3 times in the last 5 years. It’s usually more about maintaining high profit margins than about saving the company. The last one amuses me the most because they’ve spent more money during and after the retrenchment of the one admin person than if they’d just kept her.

        Reply

        • miaau

          April 21, 2016 at 13:48

          When we did it, it was truly a last resort effort, but it was still harsh.

          Of course profit comes into, this is business, but yet there must still be a human side.

          Reply

  2. Raptor Rants

    April 21, 2016 at 12:15

    Very sad indeed. It’s sad to see this. But I fail to see how PC markets are dropping. With businesses now more reliant on computers than ever before I can’t see how sales are dropping. It just doesn’t make sense

    Reply

    • Deceased

      April 21, 2016 at 12:30

      See the Emperors’ comment ^

      Reply

    • HairyEwok

      April 21, 2016 at 12:41

      Intel had revenue growth of $2.2 billion… So yeah no market drop there.

      Reply

    • HvR

      April 21, 2016 at 13:34

      Has been a very tough time for lots of companies, a lot of them used to have 1/2 year upgrade cycles now stretch them to 5/6 year cycles.

      I think a lot of it has to do with Intel’s own success biting them in the ass; the speed at which they increase CPU performance far outweighed the typical corporate need.

      Also the Cloud/distributed computing/server services has pretty much eliminated the need for small and medium companies to maintain their own physical servers. Lot of the “traditional PC market” were small servers

      Reply

  3. HairyEwok

    April 21, 2016 at 12:38

    Most people are saying ‘oh no, these 12 000 intel employees should go and work for AMD now’… For all we know most of the lay-offs are Janitors and secretaries. And i doubt AMD need more secretaries and janitors.

    Reply

    • HvR

      April 21, 2016 at 13:27

      LOL, AMD’s only worry is staying afloat now people want them to more than double their workforce.

      AMD fired a third of their workforce over the last couple of years, they just finished firing 500 people (5%).

      Reply

  4. miaau

    April 21, 2016 at 13:00

    I do, however, find this a sad situation, as lives, families and all that are deeply effected.

    Spoke to someone at a high level in a very large corporate that this. They made a small mistake. Seems, according to this gentleman, all the top talent took packages first and found new work pretty quickly, being top talent people. So, they changed jobs AND got to pay off part of home loan or something.

    Reply

    • Greylingad[CNFRMD]

      April 21, 2016 at 13:07

      That’s usually how these things pan out, when a company needs to save money, the best place to start is the highest expense, if that is the top brass of a company, then that’s where you start and usually you wouldn’t have to worry too much about them, simply because they are highly qualified personnel and could find employment quickly, whereas, if you were to start at the bottom and work your way up, the hardest working people will be the ones that are fired, and we all know how well 15 bosses and 1 worker fares…

      Reply

    • HvR

      April 21, 2016 at 13:30

      I was at a company were this happened.

      The first round restructuring guys effectively got 4 months bonus. Guys like me who stayed till the end got screwed out of their 45 days of accrued leave and standard severance package.

      Reply

      • Greylingad[CNFRMD]

        April 21, 2016 at 13:50

        Yep! This^

        Reply

      • Matthew Holliday

        April 21, 2016 at 13:56

        happens in companies of all sizes unfortunately.
        a family member had to go through a similar thing, business rescue came in, new management etc. voluntary retrenchment was offered, but essential/higher tier personnel were refused when they applied, their lives were made miserable until they quit, severance packages, pensions etc, all gone.

        money makes the world go round i guess.

        Reply

  5. Galbedir

    April 21, 2016 at 14:03

    Could we all be going Apple in afew years? *gasp*

    Reply

  6. VampyreSquirrel

    April 21, 2016 at 16:01

    At least Intel is doing it over a period of time, giving staff packages, and/or helping them find work else where. Many other companies wouldn’t do the same.

    Reply

  7. Roger

    April 21, 2016 at 19:52

    Funny how the article doesn’t mention that they are replacing these workers with a push of the H1-B visa program much like Disney has done.

    Reply

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