Intel could unveil thousands of job cuts when it publishes third quarter earnings later this month, Bloomberg reported.
Intel Corp. (INTC) – Get Intel Corporation Report shares moved higher Tuesday following a report that suggested the chipmaker is preparing to cut thousands of jobs in the coming weeks amid the ongoing slump in demand for personal computers.
Bloomberg reported late Tuesday that Intel is looking to reduce its overall global headcount, with the bulk of the cuts aimed at the chipmaker’s sales and marketing divisions. Bloomberg said layoff plans would be detailed alongside the group’s third quarter earnings on October 27.
Intel slashed its full-year sales forecast on July 29 to between $65 billion and $68 billion, following weaker-than-expected second quarter earnings, as softening demand, supply chain disruption and run-away inflation continue to hammer PC demand.
Current quarter sales, Intel added, would likely range between $15 billion and $16 billion.
Intel is also facing pressure in its data center chip business, as well, with analysts at Wells Fargo cautioning that “increasing concern over year-on-year data center revenue declines in 2023 will persistently weigh on shares” as it cut their price target on the chipmaker by $13, to $32 a share, earlier this week.
The brokerage added that Intel could also see a writedown of its bloated inventory levels, which were pegged at $12.2 billion at the end of its second quarter, following similar markdowns at rivals Nvidia (NVDA) – Get NVIDIA Corporation Report and Advanced Micro Devices (AMD) – Get Advanced Micro Devices Inc. Report.
Intel shares were marked 0.80% higher in pre-market trading to indicate an opening bell price of $25.24 each, a move that would still leave the stock down more than 50% for the year.