They say it is direction change without offering details (which sounds like shallow lie).
It is not profits only as PC is down while Server is up and such fluctuations in the past were treated differently.
... or is it board of directors with major shareholders commanding or demanding this (due to possible combination of reasons and possibilities like soon coming recession evident in already falling earnings across the stock market).
IOT everybody and their brother in this business, they will make chips for a buck or less, good luck Intel making money here, how much does a 14nm wafer cost and with that yield how many 1 buck chips will need to be on it to get 60% GM?
10nm will it come on time, if not what will fill the factories. 22nm is old news, not much money and revenue there. 14nm no more designs and old products with already almost double digit volume drop.
Nothing to fill the factory or fill it with 1 buck chips.. getting really ugly, more than 12K got to go to survive BK
20 percent growth rate comes with proper planning. Layoff are the sign of management listening to idiots and going through the wrong strategy.
@vgo thinks you can grow 22% in a quarter on smoke detectors? Oh there's smoke alright, but it's coming out of what's in your mouth
IOT is the smoke-detector and firealarm business, THATS IT!! I was a key technologist at one of the first 10 IOT companies on the planet, I saw our salespeople struggle to find even 1 buyer, and I co-founded one of the second 10 IOT companies on the planet (but left after 10 months as I didn't believe it had a future). There is NO business there. The only good business is something that a person needs to do work. If there were money in having a microprocessor in every lightbulb we could have done it 2 decades ago...
Computers have become as ubiquitous as socks in our house. We have 4 household members and 18+ useful computers (27 if you count ones that need minor fixes or which don't run modern software). Each person has N copies of {desktop, laptop, tablet, phone} and I'm not even talking about embedded devices that take your full attention like a blu-ray player or chromecast or amazon echo.
You guys are crazy. First off I work at Ronler and they are hiring a head for each one they are cutting there is no thinning of the herd, just going to younger lower paid workers- mostly cause they can do that and continue to give themselves 12^ raises un der the guise of trimming cost (hope you f---ers get cancer). 2ndly if it is true the TSMC is going to start tapeout of 10nm this season while Intel does not, the declination of the only business Intel has left will fall so sharply the real layoffs without packages will be coming fast better watch out friends. I'm taking the VSP and moving on.
How many 10nm factories are needed. Die getting smaller and volume going down, most of value is in cloud which is even lower volume. Intel only needs one big factory or a couple smaller ones. Hard to close overseas due to incentives, watch out as they really look to scale back domestic operations.
Look at how efficient a design team Apple, Qualcomm, Nvidia have and benchmark against Intel.
Foundry has how many people and how much business, with the assimilation of Altera and likely restrictions I suspect they are way over there too!
Lots more to go in the next two years!
12K laid off is just the beginning. The board has not discussed a key indicator called profit per capita. The 12K people, making total Intel population about 95K, will bring Intel to the bottom of the high tech company distribution. Statisticians will tell you they want to be "average" or center of distribution nIntel would have to lose an additional 15K people using present proft margin numbers to become statistically average. The net result would be 80K employees worldwide.
Jamestown or maybe a Stalinist Purge
@Hpkp11y-czd so true! And all those who are still in lala land who decided NOT to take VSP/ERP, have already drank the poison...they are on their way to dying a slow death and should have jumped ship!
Intel = Jamestown. Starving time is coming.
We are paid to compete with our colleagues, not our real competition in the market. That is what rank-and-yank does and why GE and Microsoft moved away from it. The dysfunctional rank-and-yank system is going to get even more dysfunctional as with larger cuts people will focus even more on competing with peers and ignore the external environment. Intel is squandering it's talent in order to create a "fairness utopia" that will inevitably drag the company down.
Uh, you said servers are up? What the hell fairy land news are you reading. Google announced they are moving away from Intel CPU processors and going to an all Arm Server based capability worldwide. News flash, Google is the largest CPU user on the planet. AMD gave China the license to build as many processors as they desire...News Flash: That's competition Intel will not be able to compete with margin wise.
Intel knows their fate. Either Intel move the ship in a different direction now, or Intel becomes another large corporation who falls off for several years. Study Apple and IBM if you want to understand what's happening to Intel. Now Intel is not going away. I'm not suggesting that at all. Just like IBM went off reinvented themselves and became a huge consulting company, Intel will need to reinvent it self. That will come with hard times, many changes, new faces, and a whole bunch of fired CEO's over the next 10-15 years.
Intel is preparing itself for this new realm. They will prevail but they do need to fire all leadership, to include that fat face Murthy who's failed Qualcomm (why is this piece of sh-- at Intel)?
@Hpkp11y-bbs Fact is MCM gets paid on diversity. Intel's toxic culture means you aren't going to retain younger diverse people. You just aren't. The place is insane, and we are losing these diverse younger people faster than average. Hence the only way to hit the diversity numbers is to push out those that don't advance your goals. Dick Taylor and BK figure out the algorithm that pushes out the "right" people, and the hide behind a cloak of "algorithm" and then start the campaign to badmouth people that have had the temerity to be GASP successful.
Since he's probably reading this. Go F yourself Dick Taylor you sack of sh--.
Get rid of 12K and viola earnings are better as costs are better. The organizations that are hit hard will find a way to work their people even harder to get what has to be done done.
Will it make IoT all of a sudden grow faster or make money, NO
Will it make EUV happen faster, NO
Will it make cloud grow faster, NO
Will it make 3D nand NOT a commodity, NO
Will it make Moore's Law go another generation, NO
Will it make 10nm come in on schedule, NO
It is all to make it appear senior executives are doing a good job. What they really did was ask HR for various brain dead options to reduced cost, viola they got this.
Will it save BK's job, likely not...
The strategy is super win-win (not from a cost standpoint):
1) ISP get rid of supposedly low performers which are most likely not. Result: perceived savings, and scare the troops to work harder
2) VSP look like a generous company offering a dignified way out for average employee (average at Intel means only work 50-60hrs/week). Result: perceived savings, scare the vsp who don't take it to work even harder, scare the troops into working harder. Us vsp could be scared into working even more but still be doubled and then offered ISP (possibly cheaper).
BK compensation is tied to earning targets and what easier way to do that by laying off thousands.
He will continue to do this every year to ensure huge raises and bonuses.
I also heard foundry business at RA1 was a disaster, right? But there are no significant layoff there may be due to integration of that to alters fpga.
They overpaid 4x for Altera deal leading to 2015 layoffs. In a IEEE conference I heard someone explaining that IOT is just s hype like big data that faded away. The concept of IOT existed when internet was invented and everything needed to be connected. Noy sure what intel wants to do. Intel is playing dirty game with micron technology by hvm Ing in china on memory nand parts and illegally hiring micron employee from jdv peers to their china plant. Conflict of interest and an unethical practice. Breach of trust with research partners on Mon volatile memory.
Do you guys think this board will break the company up and sell HVM factories?
There's no reason per se.
Desktop and laptop processor revenue was down $1.5 billon in 2015. That was largely made up by increased revenue from other divisions, resulting in total revenue essentially flat with 2014. Not good if you are a growth company.
Desktop and laptop processor sales fell again in Q1, matching the low point of demand that occurred in 2011.
Management needs to cut costs, else earnings and margin will go down.
That does not mean they have to go about it using a very stupid method.
Two real reasons. Both made INTEL management hysterical and paranoid. Since INTEL executives in charge are not too much involved in their jobs. :-)
1: Moore's Law does not work anymore. Namely, IV Lithography is at the end of Life. EUV lithography does not give correct numbers yet (lot of buggy silicons). And ARM is breathing behing INTEL's back. Samsung and TSMC are closing...
2: Alternatives are failing, namely:
Mobile strategy failed completely ($10B USD spent on nothing)
IOT is the next future gloom and doom (poor execution)
Wind River completely went South (another failure)
McFee overpaid $4B USD
NAND SSD and Servers remain the driving INTEL horses for the revenue, and these are far not enough to feed 107K employees (probably 50K, at the end of the day).
Time Will Tell. :-)
F28 has lost a good number of their ICs. Seems like a brainless action based on the face that they will be going through startup shortly. It is probably a good thing for the vendors though as they have people ready to work.
I believe anyone who has been working at Intel for the last 10 years feels the company is bloated and inefficient. My favorite number was 30% redundant. The main issue was with who were fired and for what reassons. I haven't seen a single redundant person being sacked in 2015/2016 layoffs yet. All were ICs with solid performance.
This means the talk/work ratio in Intel has increased significantly during the last year.
Good question. It does not feel an action of a company expecting near term growth.
By itself it means same overall work with less people and therefore more work per employee.
In groups where projects are cancelled then there is some logic since work is removed and focus is improved. In a TMG factory it is not clear where work reduction is going to come from. It feels like we just remove 10% of the workforce and figure out the details later. It is likely we just have to work harder - a) pick up the work of departed colleagues and b) add more to our focal brag sheets to avoid future SSL4.
It is a big stick for driving the surviving workforce - not a carrot.