Intel Cuts 12,000, 11% of Staff

SAN JOSE, Calif. – Good night to the PC as an icon and driver of the semiconductor industry. Intel Corp., its head cheerleader and advocate officially cut it loose today announcing a cut of 12,000 employees, 11% of its staff amid a sequential decline in quarterly revenues and profits.
 
It’s a decision that’s been brewing for years. Intel CEO Brian Krzanich was brought in to shake things up when the PC decline was among issues dragging down his forerunner, Paul Otellini.
 
Krzanich brought in his own right–hand disrupter late last year, the man who ran the smartphone chip set business at archrival Qualcomm.  Two weeks ago, Venkata “Murthy” Renduchintala signaled today’s big layoffs when Intel announced his closest reports were leaving the company.
 
The news comes as Intel reported $13.7 billion revenues, down 8% from the previous quarter but up 7% from the same quarter last year. It made profits of $2 billion, a 43% plunge from the prior quarter but up 3% from the same quarter last year.
 
In the reorganized company, Intel’s client computing group still makes up 55% of its revenues. Its growth engines include its data center group which now makes up 29% of revenues. Its newly reformed Internet of Things Group combines what has been a thriving embedded division with an emerging IoT business.
 
Its acquisition of Altera creates a new Programmable Solutions Group. A Non-Volatile Memory Solutions Group, the Intel Security Group (formerly McAfee) and a miscellaneous segment round out the company.
 
As some analysts anticipated, Intel is leading with its strong foot – a data center market its Xeon chips dominate and an embedded market where it is gaining increasing sway.  “We are evolving from a PC company to one that powers the cloud and billions of smart, connected computing devices,” said Krzanich in a press statement announcing the quarterly results.

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