Despite CHIPS Act Boost, Intel Plans To Lay Off Thousands

(CTN News) – Despite efforts to expand its semiconductor production facilities, Intel plans to lay off thousands of workers in the next month.

This computer part manufacturer is expected to announce the job reduction as early as this month, according to Bloomberg.

The changes are expected to be announced during the company’s quarterly earnings report on October 27. Post-pandemic economic conditions have resulted in a decline in computer sales. Over 20% of employees may be cut from some divisions at the company.

During the company’s last quarterly earnings call, the reductions were alluded to.

Pat Gelsinger, Intel’s CEO, told investors that the company plans to reduce the company’s core expenses in calendar year 2022 and will take additional actions in the second half of the year.

There was a notable decline in worldwide PC shipments over the past year. According to Gartner’s preliminary data, the industry sold only 68 million units in the third quarter of 2022.

This represents a decline of 19.5% over the previous year. Apple was able to avoid the drop in sales that was reported by the majority of computer companies.

In order to help companies compete with China, Congress passed legislation to assist companies in building new semiconductor factories.

Intel announced its new Ohio-based factory in January, only to postpone it due to Congress’s inability to pass the CHIPS Act.

After the legislation is passed, Intel is expected to receive tens of billions of dollars from the federal government to assist in covering production costs.

The value of Intel stock has dropped over the past year, and the company has taken internal measures in order to ensure shareholder profit.

Over 50% of the company’s share value has dropped in 2022, with a 20% decline in October alone.

Washington Examiner’s request for comment was not responded to by Intel.

SEE ALSO:

Microsoft Surface Laptop 5 Hands-On: Same As Ever, But Faster