Intel is laying off over 15,000 employees and will stop ‘non-essential work’
Intel is laying off over 15,000 employees and will stop ‘non-essential work’
That’s a lot of layoffs.
So they got all that money from Uncle Sam's CHIPS Act only to lay off 10,000 employees and make themselves "lean". Govt funded unemployment.
Prepping for all those spicy class action lawsuits coming their way.
You’re probably right, the generation 13&14 will be riddled with lawsuits.
I'm rather OOTL with intel. Mind giving me a short summary? What'd they do this time?
Not sure a short summary will cut it.
They had no competition for a long period and ended up with an accountant CEO that caused their R&D to stagnate massively. They had a ton of struggling and failing to deliver all in most areas, and they wombled about releasing CPU generations with ~4% performance uplifts, probably saving a few bucks in the process.
AMD turned back up again with Ryzen and Epyc models that were pretty good and and an impressive pace of improvement ( like ~14% generational uplifts ) that caused them such a fright that they figured out they had to ditch the accountant.
Pat Gelsinger was asked to step up as CEO and fix that mess. They axed some obvious defective folks in their structure and rushed about to release 12th generation products with decent gains by cranking the power levels of the CPUs to absurd levels, this was risky and it kind of looks like they are being bit with it now.
Server CPU sales are way down because they are just plain uncompetitive. They have missed out on the chunk of money they could have got from the AI bubble because they never had a good GPU architecture they could leverage over to use. They have been shutting down unprofitable and troublesome divisions like the Optane storage and NUC divisions to try and save money, but they are in a bad way.
The class actions mentioned elsewhere in the thread are probably coming because the rush to make incremental improvements to 13th generation and 14th generation CPU's resulted in issues with power levels and other problems that seem to be causing those CPU's to crash and sometimes fail altogether.
A bug or whatever in their 13'th and 14'th gen CPU's makes them slowly but permanently degrade and cause crashes. Intel have not been handling the issue as you would hope since the discovery. Denying, downplaying, refusing a recall, refusing extended warranties, the lot. Now the lawsuits are cooking.
IIRC they sold and shipped 2 generations of CPUs that were essentially defective and unrepairable.
Two generations of bad cpu's and their solution is get rid of the workers so they can keep their bonuses.
MBA brain rot
Gotta keep that angle at 45° forever and ever.
Two words, bean counters.
I wish them brain drain for being such greedy. Let their best people leave to better pastures.
Part of the lackluster CPU problem is that Intel was pissing away their money on other adventures. CPUs were "in the bag", so they kept spending money on other stuff to try to "create new markets". Any casual observer knew their fundamental problem was simple: they got screwed on fabrication tech. Then they got screwed again as a lot of heavy lifting went to the 'GPU' half of the world and they were the only ones with zero high performance GPU product/credibility. But they instead went very different directions with their investments...
For example they did a lot to try to make Optane DIMMs happen, up to and including funding a bunch of evangelism to tell people they'll need to rewrite their software to use entirely new methods of accessing data to make Optane DIMMs actually do any better than NAND+RAM. They had a problem where if it were treated like a disk, it was a little faster, but not really, and if it were used like RAM it was WAY slower, so they had this vision of a whole new third set of data access APIs... The instant they realized they needed the entire software industry to fundamentally change data access from how they've been doing it for decades for a product to work should have been the signal to kill it off, but they persisted.
See also adventures in weird PCIe interconnects no one asked for (notably they liked to show a single NVME drive being moved between servers, which costed way more than just giving each server another NVME and moving data over a traditional fabric). Embedding FPGA into CPUs when they didn't have the thermal budget to do so and no advantages over a discrete FPGA. Just a whole bunch of random ass hardware and software projects with no connection to business results, regardless of how good or bad they were. Intel is bad for "build it, and they will come".
You know they pocket those subsidies when this happens.
Right to the pockets of the least useful in the company - the executives.
They only made 50 billion dollars of profit last year. Won't anybody think of the shareholders
Idk about other subsidies but they're probably not getting any CHIPS Act funds with this sort of behavior.
stop 'non-essential' work
So those jobs they're cutting start with everyone with "Chief" in their title, right?
Of course not. The Chiefs earn every penny by making the difficult decisions to keep stock prices up. /s
What’s crazy to me is that they are laying off more employees than the total number of full time employees I’ve worked at for most companies.
They are laying off 12% of their work force.
That's what happens when companies are too fucking big, and intel was essentially a monopoly for a while.
I have interned at AT&T while at University, laying off a 1000 people would be less than 1 % for them.
After seeing this article I went down a rabbit hole and IBM isn’t even in the top 10 US of most employees. Here’s some of the popular ones from the top 30.
- Walmart - 2.3 Million
- Amazon - 1.61 Million
- DHL - 594,000
- FedEx - 547,000
- UPS - 536,000
- Home Depot - 456,000
- Target - 415,000
- Kroger - 414,000
- Marriott - 411,000
- Starbucks - 381,000
- Walgreens - 333,000
- Pepsi - 318,000
- Costco - 316,000
- Chase - 309,000
- Lowes - 300,000
- IBM - 282,000
- CVS - 219,000
- Bank of America - 212,000
https://en.m.wikipedia.org/wiki/List_of_largest_United_States–based_employers_globally
... the 12 percent that actually does something too...
While Intel has absolutely been losing money on its chipmaking Foundry business as it invests in new factories and extreme ultraviolet (EUV) lithography, to the tune of $7 billion in operating losses in 2023 and another $2.8 billion this quarter, the company’s products themselves aren’t unprofitable.
So what I'm getting here is that the CEO and or the board decided to invest in something that is losing a ton of money and so now 15% or more of the people who have been working diligently to actually make the company money are going to pay for it by losing their job.
So what I’m getting here is that the CEO and or the board decided to invest in something that is losing a ton of money
Intel has an enormous technical debt that they're finally struggling to pay back after they hit a brick wall with their 7nm Titanium chipset.
It isn't that this is wasteful spending so much as it is big upfront costs for future productive development.
That said, the fact that this work has to be government subsidized in order to be done raises the question of why this business is private at all.
I think it's even more absurd than that. The CEO/board decided to make a long-term investment which wasn't going to pay off for several years. To what should be the surprise of no one, that meant short term losses.
Framing an investment in a massive amount of new infrastructure as a loss because it didn't immediately start operating in the black is beyond unreasonable, but that's the demand when all that matters is quarterly gains and year-over-year growth.
That's definitely a huge issue but they're going to have a hell of a time on the overcooked processors on the market right now. They've sold a hell of a lot of defective product over the past couple of years. Consumers and third parties are going to come after them for refunds. Consumer confidence is way down. They're going to have a hell of a time trying to sell 15th gen to people. Everyone I know who knows what in the hell is going on is going to AMD.
Consumer confidence is way down. They're going to have a hell of a time trying to sell 15th gen to people. Everyone I know who knows what in the hell is going on is going to AMD.
I've been in the industry since back when AMD actually was making the processors for Intel. And people have been saying this exact thing every time there's a fluctuation in the processor market. Yet Intel still basically owns the market anyway.
The failure in Intel isn't their processors, it's their management.
You have a hell of a love for that phrase!
That's exactly what happened, and that's how layoffs always work.
The losses of the horrible decisions of the board/owners/management/etc are paid for by the blood of the workers. It's so wonderful and very fair.
Several tech companies have really stopped giving a shit lately. Intuit laid off a ton of people and referred to them as "not meeting expectations", and Intel's laid-off folks are now all apparently working on non-essential stuff.
Imagine losing your job and being told second-hand after you'd been shown the door that you were shit.
Fuck these companies.
I do a moderate amount of work with Intel, and I'd say the problem is not that the people are "shit", it's that their bureaucracy is so messed up. You have the people that actually engaged with their customers (support and sales), who marketing largely ignores, and marketing makes up stuff that isn't in sync with the field guys, but that's hardly a problem because the development executives then go off on their own "cool" ideas, without any buy in or anything from support, sales, or marketing. This has real impact, but then you have some middle managers spooling up side projects with like a dozen dedicated people each, adding another indirection of effort totally disconnected from any business capability.
So end result is you have an admittedly qualified team toiling away on a project that there's just no way a potential customer will even hear about, working on problems that someone "imagined" that a customer never had, or is trivially solved in the industry already, but they don't have the experience to know that. Even when the work is good and people might want it, it's still doomed to obscurity because there's such a disconnect between the engineers and any actual communication with potential customers.
Yes, I agree, and I think it's a reflection of society's values over the past 50 years.
We are living in a world with more of a "make money and fuck all else" mindset. Children of wealthy elites are living very privileged childhoods, and as a result, have less empathy and more contempt for real people. We are now seeing the effects of living in a society where the needle of social values is pointed 100% on the side of capitalism and 0% on the side of moral values. And how that has affected our perspectives of a society at large: a general lack of caring, a lack of empathy, a lack of conscientiousness from the top, tossing normal, real people aside like rubbish in a bin.
We're seeing what happens when you let a generation of incredibly entitled children grow up to take the reins of society. We all know how it ends....
(And for what it's worth, I think a long, extended Great Depression-style event is much more likely than a violent conflict, especially given how docile citizens of the west have proven themselves to be over the past several decades.)
Stagnation, baby.
they fired the guy that single handedly managed meshcommander https://github.com/Ylianst/MeshCommander
it was a tool to remotely control intel vpro machines, intel's own tool is not as good as what the old ex-employee did in his free time
That’s not surprising if you know how software products nowadays are planned and built in bigger companies.
It’s harder to do it with 50 people than with 5.
I wonder how many of the over 1000 VPs will get canned. You read that right. I worked there at the beginning of my career. I know a lot of people who are now VPs. Only one of them was actually any good. One guy couldn't even manage his own staff meetings when he was a first line manager. Nice guy, not dumb or anything, but not brilliant, and a terrible organizer.
Ah yes, the ol' "promoted to the level of their incompetence". SOP. Or SNAFU, take your pick.
I hope this never happens to me but based on the Peter Principle I won't know when it happens.
Oh shit maybe it's already happened...
over 1000 VPs
I used to work for Comcast and it was astonishing how many vice presidents there were. It might be the most meaningless corporate title ever. Even if they had real work to do they never had time to do it - VPs there turned over faster than beignets at Cafe du Monde.
Publicly traded companies are a curse on humanity.
All the idiot Americans cheering about scapegoating single mothers as welfare queens since the 80s, never an utterance by anyone with power of all the DO NOTHING private investors that drop their chips from their last trip to the exploitation casino and demand all the profit for no labor whatsoever.
"Fuck you, I'm an owner, pay me."
Prior to the Jack Welch Ronald Reagan betrayal, the model was correcly "customers first, employees second, investors third."
Everything falls apart when you give every spare penny to the people who A) dont DO anything to make the money they demand and B) demand the companies they own sabotage their missions and futures to goose net profit for the current quarter so they can profit and walk away having severely damaged those company's ability to do what they existed for, only to demand it of other companies.
maybe the root-cause is less the publicly-traded part but rather the total lack of any consequences?
but yes i totally agree, any company publicly traded will get a payed-for-CEO after a while and latest at that point is where no problems are resolved any more, but instead are IMHO always created on purpose.
Problem with publicly traded is that there is no personal risk past the price you bought the stocks for. You paid $ 1,000 for some stocks of "evil chemical corp"? Now your financial interest, and thats the only measureable one, would want them to pollute for a damage of $ 10,000 respective to the stock value if that increases your stock price to $ 2,000, as long as the risk of them having to pay for cleaning it up is smaller than 50%. Problem is the same holds true for a damage of $ 100,000 relative to your stock. Or any arbitrarily large amount. Your share in the damage caused could be in the billions, but worst thing the company goes bankrupt and you loose your stocks buying price.
The only alternative would be holding shareholders responsible with their own money, if a company is forced to pay up for damages they caused, going past its bankruptcy.
In January 2022, Intel announced an initial $20 billion investment that will generate 3,000 jobs,
Not sure why Biden didn't put any terms and conditions on giving away all this money 💰?
The US and Europe has become acutely aware that too much semi-conductor manufacturing has been outsourced to China and other Asian nations and they're trying to build some back domestically. So that's the geopolitical reason for it.
Maybe the US should consider Intel's massive reduction in staff and faulty chips as a national security threat and nationalize them.
That's the justification. Don't you know what kind of people gets into high governmental positions?
Making some friends rich was the reason.
Still, this sucks huge donkey balls, a lot of very smart and very knowledgeable people, maybe more valuable than a 100 (ok, maybe 10, or maybe 5, it's a rhetorical device) copies of me, work in such inefficient structures, while there could have been a dozen TSMCs over the world with their competencies.
I have come to agree that nations have interests, but their governmental structures generally work against those. There's a wheel to be invented there.
I'm not sure what this has to do "Not sure why Biden didn't put any terms and conditions on giving away all this money 💰?". Wait, I do. This is question exactly why Biden didn't put condition of bringing production back.
- Russian troll, according to some.
$20 billion investment that will generate 3,000 jobs
Lol that's $6,666,667 per job. I could create a job with that much money: counting all my fucking money.
Actually, yeah, one can pick 3k people and just pay them 4k$ per month indefinitely till they die and something will remain.
These corps are slimy Fucks. It probably did create 3k jobs. Low paying, temporary jobs. These layoffs are probably other jobs
The U.S. should sue the shit out of them.
It seems you are confusing US for EU
The string is that they use it for the creation of a domestic chip plant, not salaries for existing employees.
It's a good thing we gave them BILLIONS of Taxpayer Dollars! Otherwise they would have Laid Off Employees! Anyways we don't have enough money in the Budget to Feed Starving American Children!
There’s a dude in wallstreetbets who dumped a $700k inheritance into Intel stocks. lol
Meh, he bought a significant dip, even if it goes lower in the coming months, in a few years he will be way up. It's not like Intel will go away, they are in a duopoly market.
Intel has been down from around 50 YTD to 30 likely in a few years it will be back to 50 and he will close to double his money
Though he could have probably just put the 700K into S&P 500 and have his retirement taken care of, since he is in his 20s
Holy F, what an idiot nepo baby. Maybe daddy who pays for college works as a VP at intel
Dude, what the heck is wrong with people. Wealth is wasted on the stupid.
its mainly that our modern culture worships money and things whoever has more of it is inherently better.
So rich people make bad decisions because they think that being rich means they are always right, and that their ideas are special and magical and come from a mystical realm of refined thought only people with stacks of cash possess.
And when they fail, they blame everything except their greed focused short sightedness.
Layoffs will make the stock go up. It's bizarre.
I had a friend in the '90s who took a $40K inheritance and "invested" it all on $75 Fossil watches, the kind with Popeye and other cartoon characters on them. At least she was able to show them off at parties and get all the guests to go home.
So they're only keeping marketing?
I just sat through a "town hall" at a former GSK now Haleon site and a site director assured people that volume was coming back through nothing but the power of marketing alone. Apparently 8 dollar tubes of toothpaste are non sellers in a tight market. Who knew.
As a 30-year-old trying to break out into a tech career, this is incredibly disheartening.
Really difficult to not give up all hope with headlines like these. How to believe in potentials for opportunities with these barrages of bad news? Where is the hope--Any silver linings at all?Intel is a failing company and has been for years, it has nothing to do with the tech industry. They failed to invest in chip fabrication, and their designs are soundly beaten by AMD and Nvidia. Look at AMD and Nvidia, they're making record profits and hiring.
Also, the tech industry is a huge place, there are plenty of opportunities outside of the hardware niche that Intel operates in. I will admit though that the current interest rates and risk of recession does make it harder for junior programmers.
They are doubling down on that mistake it would seem. Article says most of their losses last month were from their foundry division. I realize I'm just a random person on the ground, but shit like this really has me shaking my head. For a company like Intel foundry is absolutely essential to their business. If they can't build the chips, build them better, faster, smaller, they can't compete. It's like if Airbus said they are firing everybody in their airplane division to focus on important things. What the hell, the airplane is the important thing. Same thing with Intel.
Seems like a great time to buy stock in AMD.
Apply to non-tech companies. There ate many companies who aren't in the tech sector that relies on in-house tech.
You like tech? You like wiring up and programming state-of-the-art commercial automation, access control, and cctv systems? You like to move around as well and work with your hands and tools, all on the same job? Become an electronic security technician. Been doing it for 20 years, it's great, and always hiring, almost never firing, unless you get caught smoking meth or something.
Nothing wrong with a more blue-collar style job.
Similar job is power grid installation. Those are in high demand, and you get yourself a passport and you can make even more setting up transformers in weird places in the world after a few years experience.
This sounds beyond ideal--I don't know if you're trolling, because I have to imagine this line of work is never in demand at all, but hoping for interviews soon, and I can't thank you enough even if you're joking
As the OP said, get a job outside of tech.
The biggest research hospitals employ electronic engineers, software engineers, chemical engineers, physicists, statisticians, network engineers, sysdamins, etc.
Insurance companies? Auto industry? Power companies, pharmaceuticals, local governments etc. The best part about being a STEM is that you have a place everywhere. You just gotta be willing to bend your expectations until you find something that fits you.
Get 5 remote work jobs and keep the ones that don't suck.
What kind of tech are you trying to get into?
Didn't expect CHIPS to backfire this fast lol.
Chips Act, Take 1: Hey Intel here's 8 Billion dollars to make us more chips in the US. Intel: I gotta let 15,000 of you go, there's just not enough money......
I thought they would be more tacit about it. This is too obvious and too soon after taking taxpayers’ money. But they probably don’t care anyways. Who is going to stop them or hold them accountable?
I don't think it backfired...I truly don't believe the Chips act is a jobs act. It is to address manufacturing gaps in semiconductors within the US. The US government wants semiconductor manufacturers to update foundries and gave them money to do so. The jobs that have been added within the industry have been icing on the cake but not the original intent imho.
It got us a TSMC fab, soon ish maybe lol
The CHIPS plants just started being built a few months ago. This is bad for the employees and short-term investors, but long-term Intel will be fine and the plants will be a net positive to the country.
Is this really a backfire? My read is that they're actually focusing on their core business (plus cutting down marketing). It sounds like the right move, but maybe I'm too optimistic?
I guess Intel needed that QA team, after all.
Non essential work, oh dear Product and Project managers, where are you gonna stand in the way of good products next?
Executives will be "essential", QA, sys admins, etc will be non essential.
Eliminating QA is a huge value. We all know it reduces costs relating to employing people, but that's just the start. It eliminates the number of bugs found and reduces the amount of work that comes with it. All in all it helps projects to release on time. There could be no problem with this, clearly.
The money needs to return to the government. Some wealthy fucks are lining their pockets.
What the actual fuck
There's no corporate death penalty, but there is corporate death from alcoholism, coke overdose and syphilis.
I mean, you do a TRAFU and instead of firing those logically responsible for it you fire your actual troops.
This basically means they failed to find scapegoats inside the company who wouldn't be management themselves.
Wow.
This is an admisson of no future.
They're throwing crew out of their boat full of holes to assure investors they're ship shape... for the next quarterly profit report.
Their corpse will be long since picked clean of their patents, assets, and trademarks by 2030.
I work in the industry and my understanding of the chips act is certain goals must be met in order to receive money. Something like in order to get this 50 million, you must buy 100 million of new equipment and facilities improvement. In order to get this 25 million you must have 50 million worth of new jobs. These requirements were also spread out over years so you couldn't artificially inflate your work force or sell off equipment.
Not saying Intel doesn't suck, but I doubt they are getting chips act money now. Or they will have to have a big turn around in the next few years to do so. They certainly aren't getting a free 8 billion.
These layoffs will only be for a quarter or two. Just enough for the c-levels to unlock their full bonuses.
And create a glut in their labour market niche, which will take many years before the wages recover to what they were. In the current 20 year permanent labour shortage scenario, this is the way to prevent wages from increasing. Sure these demand shocks will create issues by they're making the bet the lower overall expenses for wages will make it all worth it. This is them leveraging the imbalance of power been employer and employee
Somebody should make a Borat Meme with AMD and Intel "Big Success!"
Done.
Thank you kind sir!
While i dont like intel, I hope they wont sack GPU division.
They won't. That's their springboard into that multi trillion dollar AI market everyone keeps talking about
unless some MBA decides that it's better to sell single purpose expensive ai boards without video output
So the semiconductor jobs and manufacturing aren't coming back to the US?
Who else saw this coming? Because I did.
I remember telling people that and they wouldn’t believe it. Time has a way of making the unknown known.
Read article
I read it and predicted this outcome in 2022. If Intel wanted to open factories and employ people in the US it would have done so without the CHIPS Act.
No company will say no to free taxpayers’ money, so they didn’t. But they spent it on stock buybacks and now they’re laying off thousands of workers and are selling a defective product.
Now here’s an article for you to read that may be unpalatable https://globalsouth.co/2023/07/10/michael-hudson-why-the-u-s-economy-cannot-re-industrialize/
This sort of thing is increasingly making TSMC a monopoly as a fab. Due to the extreme economies of scale, fabbing looks like something that is hard to do well under the capitalist model. Perhaps a good time for some of the larger nations of the world to start publicly owned fabs (that publish their research instead of hoarding it) instead of ending up with the whole world reliant on one company that will eventually be able to name its price.
After all this time, AMD finally won. They made a hell of a comeback too. GG guys.
I feel like they have the farm bet on Falcon Shores and (to a lesser extend) the Xe line now, and of course the foundry.
It'd be great if the bad rumors and delays would stop... yeah...
Anyone else still beliving capitalism will do R&D willingly? Even most recent and hyped(not without reason) development - powervia - came from institute from former soviet bloc.
FIFTEEN THOUSAND HOLY SHIT
How long before Nvdia buys them, or at least tries to. Nvidia tried to buy Arm but got stopped by the UK government.
Arm is worth 5.3bn USD and employs just over 8000 people. Intel is worth just over 100bn USD and employs 124,000 people.
Nvidia is worth 42bn USD and employs 30,000 people.
That makes Intel over twice as valuable as Nvidia with over four times as many employees.
Nvidia is worth 42bn USD and employs 30,000 people.
Nvidia's has a market cap 30x of Intel's. So it could issue more stock to raise capital for a buyout. It's not the company equity but the market cap that it needs to have money to purchase. Even a controlling stake of > 50% would give them defacto control. Of course governments & regulators would probably block it or force Nvidia to divest bits of itself, and that's probably the greatest protection Intel has against such a scenario.
But if Intel weakens further, it may well be someone else tries to acquire it. I bet a lot of companies would love to snaffle it up. It's kind of ironic that Intel used to be the big dog in the semiconductor space but even AMD is bigger than it these days and are potentially many others who'd like buy it out. In fact, for all we know Intel might be shedding all these jobs to make it look more attractive to potential buyers.
Don't understand your "worth" numbers, that's generally market cap and those numbers don't line up. The employee counts line up...
100B is... close enough for Intel (though they have fallen to 95B). So $730,769 per employee
ARM is $140B... So $20,000,000 an employee...
nVidia is worth 2.7T.... $90,000,000 an employee...
Nvidia wants IP. They do not want to buy foundries. It's too volatile and dependent on government subsidies while also being well outside their core competencies. If their products don't sell as a fabless company, they don't see growth and lose on the manufacturing cost and stop placing orders. If their products don't sell and their chip fabs run idle, they lose a shitton of money on not just the above but also the cost of maintaining the fabs. Not only is there no guarantee that Nvidia would be able to run the foundries better, it's actually quite likely they'd run them worse.
At this point I'm starting to think that if you want to subsidize semiconductor manufacturing in the US the Global Foundries might be a better investment. At least they've already hit rock bottom.
Lets hope they ditch the israel division
Why that specifically?
Because Intel takes American subsidies, so it would be best to keep the money circulating in America by providing jobs to Americans. Not subsidize some Apartheid in the Middle East.
Boycott Divest Sanction
It's not necessarily the thread to bring it up but linkerbaan is on a mission.
Let's hope they ditch.
Wow, intel must really be struggling if they need to lay off this many people. I don't think it's reasonable to invest in Intel at this time.
Or well, I think news of layoffs should always be interpreted in a way that's pessimistic for shareholders.
Have you seen the performance and efficiency of these arm chip? The performance and battery life of Apple's chips compared to the Intel chips before then? Intel should be absolutely embarrassed.
I must admit I don't keep up with chip developments.
So, buying opportunity?
"Here is more evidence that our system is fundamentally broken and doesn't serve the people who make it run anymore"
You: "How can I profit from this?"
You sound like a CEO in the making.
I mean, stock prices do go up after stuff like this. It's a reliable way to profit.
The system sucks, but this is literally how rich people turn money into more money, while we complain we don't have enough.
I may be a socialist, but I live in a capitalist dystopia, so sometimes I just exploit the system that exists instead of constantly taking the idealistic high road and getting kicked in the teeth for it.
Would be awesome if DARPA bought them...