This is a bad news for many people earning their living working for Intel. At a press conference with analysts, Brian Krzanich, CEO, Intel Corporation [NASDAQ: INTC], announced the company will be cutting 12 000 jobs in what he described as “a restructuring to accelerate its transformation”.
The cut represent 11% of its total global workforce. Coming at a time when desktop computer sales have tanked, it is clear that Intel needs to change its strategy to be able to survive for the nearest future. Intel has been edged out of the mobile and tablet processor business, the best performing segment of the chip market.
To give a hint of what Intel plans means by ‘transformation’, Brian said “We have talked about this transformation where we are moving from a client-centric [model] 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 than that”.
Intel plans to start informing affected staff in the next 60 days and the process might be completed in the middle of 2017. The company plans to save over USD 700 million from the job cuts.
Intel seeks to move into cloud computing and Internet of Things, IoTs. The company will most importantly plan to take head Qualcomm and other competitors in the mobile processor market.
To get this done, Intel had employed Venkata Renduchintala, a former staff of Qualcomm to lead its struggling mobile processor unit. To also properly align itself towards its touted transformation, Intel has started Intel Capital’s investment decisions along its focus.
Intel’s [NASDAQ: INTC] shares fell on the NASDAQ Stock exchange by 0.61% to USD 31.5 per share when the news broke earlier today.