Gelsinger Shocks Financial Community

[Arthur Hanson]

On CNBC this morning the subject came up of Pat Gelsinger asking for money to expand while laying people off. I hope Pat Gelsinger practices some diplomacy or comes up with an explanation and plan to justify expansion while laying off people in a declining market. The financial people are looking forward for his explanation.

 

[blueone]

I think you should get your facts straight, Arthur. First of all, this was a leak, reported by Bloomberg, not an announcement by Intel. (And Bloomberg rates very low on my high-tech industry credibility scale. Some here may remember the Bloomberg-Supermicro fiasco, where Bloomberg claimed that China had used Supermicro to insert chips onto server motherboards sold to cloud computing companies to send data back to China. No physical evidence has ever been made public that this was the case.) Second, even if the leak is correct, and I think it is since Intel (always) has too much fat in sales, marketing, and product planning, most of the impact is said to impact sales and marketing, which makes sense. If it happens I'll be applauding Gelsinger. Third, whatever manufacturing expansions take place will be one or more years in the future, and there are no mentions anywhere of laying off fab employees. Finally, Intel doesn't "ask" for money under the CHIPS Act. The way the law works you either have qualifying expenditures or you don't. Every semi manufacturer in the industry lobbied for the CHIPS Act, so singling out Intel is silly.

 

[Arthur Hanson]

I appreciate your attention to detail, but I look at CNBC live every day starting at five in the morning until closing and Gelsinger asked for support many times live on CNBC or tapes they had of his interviews. As to employee layoffs, there are several sources, below is one, if you want more, just ask.

Intel Reportedly Plans to Cut Thousands of Jobs Amid PC Sales Drop

Some groups within the chipmaker's ranks could see reductions of 20%, Bloomberg reports.

www.cnet.com

Intel CEO threatens to expand in Europe over U.S. without more funds

'The rest of the world is moving rapidly,' said Pat Gelsinger, who again called on Congress to approve chip subsidies.

fortune.com

These are but a few of numerous sources, Gelsinger definitely wants government money

This is but one of several sources

 

[blueone]

I appreciate your attention to detail, but I look at CNBC live every day starting at five in the morning until closing and Gelsinger asked for support many times live on CNBC or tapes they had of his interviews. As to employee layoffs, there are several sources, below is one, if you want more, just ask.

Intel Reportedly Plans to Cut Thousands of Jobs Amid PC Sales Drop

Some groups within the chipmaker's ranks could see reductions of 20%, Bloomberg reports.

www.cnet.com

This is but one of several sources

Arthur, they're all from the same source, Bloomberg. Even in the thread I started a bit previous to yours, I couldn't bring myself to quote Bloomberg directly, so I quoted Reuters referencing them. As I mentioned already, I do think this leak is accurate, and I think Intel is fat and in need of a thinning.

As for CNBC, they aren't completely bereft of good articles, but they do have a lot of sensationalist nonsense.

 

[Arthur Hanson]

No, you are wrong, Bloomberg is not the only source, Gelsinger himself has appeared several times, many times asking for government support.. I have seen him appear on CNBC numerous times explaining why the government should support the chip industry, IE Intel. I read several publications on a daily basis, since this is what I do for a living. I have also listened to the heads of AMD, Nvidia, TSM, Apple, IBM, Google and many, many others live, real time.

 

[blueone]

No, you are wrong, Bloomberg is not the only source, Gelsinger himself has appeared several times, many times asking for government support.. I have seen him appear on CNBC numerous times explaining why the government should support the chip industry, IE Intel.

Gelsinger's pleas to support the CHIPS act are not what I was referring to. Obviously, that is in almost every national source. I was referring to the reporting on this leak of Intel's supposed lay-off. All of the sources quote Bloomberg.

 

[hist78]

This Intel/Habana press release makes me feel bloody cold.

Does Intel treat its employees as the office furnitures or disposable paper cups?

Can Pat Gelsinger at least pretend he has some sympathy to those Intel employees who are going to lose their jobs before or after Christmas?


""Habana Labs assesses and updates its technical and business focus from time to time in order to adapt to the current business reality and to continue and improve its competitiveness," read an Intel statement. "As part of these processes, it makes adjustments to its workforce and the balance between different disciplines from time to time. This is a normal process which occurs constantly and allows Habana to continue and develop attractive and competitive products and solutions.""

Intel's Habana Labs lays off 10% of workforce | CTech

The decision comes as Intel is reportedly planning a major reduction in headcount, likely numbering in the thousands

www.calcalistech.com

 

[count]

My guess is the layoff rumors are legit, but we will find out during Intel's Q3 call. Bloomberg should be a very reliable source.

I believe the chip market has slowed down dramatically (when I was talking about a recession a few months ago on this forum a lot of people doubted me), and Intel feels like they need to respond to it. We know PC sales have slowed dramatically, and my guess is data center sales will also slow down, plus Intel will be seeing continued share losses to AMD. It's going to be an ugly quarter.

 

[blueone]

This Intel/Habana press release makes me feel bloody cold.

Does Intel treat its employees as the office furnitures or disposable paper cups?

Can Pat Gelsinger at least pretend he has some sympathy to those Intel employees who are going to lose their jobs before or after Christmas?


""Habana Labs assesses and updates its technical and business focus from time to time in order to adapt to the current business reality and to continue and improve its competitiveness," read an Intel statement. "As part of these processes, it makes adjustments to its workforce and the balance between different disciplines from time to time. This is a normal process which occurs constantly and allows Habana to continue and develop attractive and competitive products and solutions.""

Intel's Habana Labs lays off 10% of workforce | CTech

The decision comes as Intel is reportedly planning a major reduction in headcount, likely numbering in the thousands

www.calcalistech.com

Intel has always been a company that is rather heartless with workers. For many years they practiced Jack Welch-style stack ranking, enforced bell curves for performance ratings, with no exceptions for high performing teams, and often new senior management assignments meant some formerly pet programs of the previous management were cancelled or minimized. I don't know exactly what Intel is like now, but that's the environment Gelsinger spent most of his Intel career in, and he was an enthusiastic proponent of it. Large US high-tech companies are often not easy places to work. The riches of high-tech attract a lot of big egos.

 

[DaRAGingLunatic]

Can Pat Gelsinger at least pretend he has some sympathy to those Intel employees who are going to lose their jobs before or after Christmas?

Losing your job is of course not a good thing normally, but when you speak of Christmas it irks me. What? A company isn't allowed to fire their staff at an unsuitable supposedly festive time of the year for certain religious folk?

Grow up. Business is business. In case you havn't noticed, Intel's earning's dropped a ton, their share price has plummeted, the market outlook is horrendously bad, and people have decided to stop spending their money due to higher living costs, so demand has plummeted. But hey, let's just keep everyone employed until after the Christmas period because we wouldn't want to upset Jesus, a bearded fat man with a list to check twice, and reindeer.

 

[Barnsley]

Losing your job is of course not a good thing normally, but when you speak of Christmas it irks me. What? A company isn't allowed to fire their staff at an unsuitable supposedly festive time of the year for certain religious folk?

Grow up. Business is business. In case you havn't noticed, Intel's earning's dropped a ton, their share price has plummeted, the market outlook is horrendously bad, and people have decided to stop spending their money due to higher living costs, so demand has plummeted. But hey, let's just keep everyone employed until after the Christmas period because we wouldn't want to upset Jesus, a bearded fat man with a list to check twice, and reindeer.

The amount saved is relative peanuts.

Any news on cutting dividends?

 

[DaRAGingLunatic]

The amount saved is relative peanuts.

Any news on cutting dividends?

I doubt that. 20% is a large cut. And you are right, dividends have been cut. Due to EARNINGS being cut. Last quarter they expected $0.70 earnings per share. They didn't meet expectations and it dropped down to $0.29.

Also I hope you remember that Intel has been on a large hiring and retaining streak for the last few years with Pat.

 

[blueone]

I doubt that. 20% is a large cut. And you are right, dividends have been cut. Due to EARNINGS being cut. Last quarter they expected $0.70 earnings per share. They didn't meet expectations and it dropped down to $0.29.

Also I hope you remember that Intel has been on a large hiring and retaining streak for the last few years with Pat.

The 20% cut rumor refers only to sales and marketing; it is not corporate-wide. Earnings are way down, but the dividend has not been cut. Gelsinger rejoined Intel in Feb 2021; it hasn't been a "few years".

 

[hist78]

Losing your job is of course not a good thing normally, but when you speak of Christmas it irks me. What? A company isn't allowed to fire their staff at an unsuitable supposedly festive time of the year for certain religious folk?

Grow up. Business is business. In case you havn't noticed, Intel's earning's dropped a ton, their share price has plummeted, the market outlook is horrendously bad, and people have decided to stop spending their money due to higher living costs, so demand has plummeted. But hey, let's just keep everyone employed until after the Christmas period because we wouldn't want to upset Jesus, a bearded fat man with a list to check twice, and reindeer.

I am not talking about the rightness or timing of intel's layoffs. I'm talking about Intel's heartless press release. Please read my original post about Intel's press release if you have a chance.

Any mass layoffs represent a company's failures in its management, strategy, or execution. It's not a happy moment for both those people who are fired and those people who are allowed to stay. Intel's press release glorified a sad incident to be a great execution of a "normal" management vision. How can Intel convince its employees to work harder and work together with the management through this difficult time Intel is facing?

From Intel press release:

"As part of these processes, it makes adjustments to its workforce and the balance between different disciplines from time to time. This is a normal process which occurs constantly and allows Habana to continue and develop attractive and competitive products and solutions."

Intel, please treat your soon-to-be former employees with respect. They are not paper cups without a face, without a name, and without a family.

 

[Barnsley]

I am not talking about the rightness or timing of intel's layoffs. I'm talking about Intel's heartless press release. Please read my original post about Intel's press release if you have a chance.

Any mass layoffs represent a company's failures in its management, strategy, or execution. It's not a happy moment for both those people who are fired and those people who are allowed to stay. Intel's press release glorified a sad incident to be a great execution of a "normal" management vision. How can Intel convince its employees to work harder and work together with the management through this difficult time Intel is facing?

From Intel press release:

"As part of these processes, it makes adjustments to its workforce and the balance between different disciplines from time to time. This is a normal process which occurs constantly and allows Habana to continue and develop attractive and competitive products and solutions."

Intel, please treat your soon-to-be former employees with respect. They are not paper cups without a face, without a name, and without a family.

I notice this forum a big bottom line place.

All the support is for Shareholders and Upper Management.

Not a lot of time for Joe Schmo

 

[benb]

As bad as it undoubtedly is at Intel, with layoffs obviously coming, it is much worse in China. The really poor Joe Schmo is in China.

I am numb to the cycles in this industry.

One thing the bosses don’t think about is the loss of potential, when you let people go. The last big cycle flushed a generation out of semiconductors in 2008-2009, setting in motion an exodus, an outsourcing, and loss of competitiveness. There was no real recovery from 2008. That’s coming back around now.