Intel said it will cut 5 percent of its global workforce in a bid to offset losses in 2013 and buffer expected weak demand for microprocessors in 2014. The job cuts will impact about 5,000 Intel employees that make up the company's 107,600-employee workforce.
Intel spokesperson Chris Kraeuter confirmed the layoffs to CRN, stating: "We will reduce our employee headcount by 5 percent over the course of 2014. We are making critical decisions and realigning staffing to meet the changing needs of our business." Kraeuter would not confirm the geographic or business units that would be impacted.
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Kraeuter stressed to CRN that the job losses were not layoffs and staffing reductions would be a result of attrition and other unspecified measures. "The 5 percent number is a target we hope to achieve by the end of 2014."
Intel missed earnings expectations by a penny in its fourth-quarter earnings report on Thursday. Intel said it had hoped sales of high-end server chips would have helped offset lower revenue from its PC division in 2013. Revenues at Intel's division that makes chips for desktop computers fell 4 percent in 2013. During its earnings call with analysts Thursday, Intel said it expected no revenue growth in 2014.
"Clearly Intel is seeing a slackening of demand in the PC area, which I guess they figure now is going to be with them for a while," said Nathan Brookwood, an analyst at Insight 64. "They just announced earlier that they are going to be delaying putting out the largest fab they’ve ever built," he said.
PUBLISHED JAN. 17, 2013