As sales slow down, Intel plans to reduce workforce by 5% this year

By on January 20, 2014, 7:30 AM
intel, job cuts, workforce, chip maker

Intel is planning to reduce its workforce by five percent over the course of 2014. The news came down the pipeline just a day after the chip maker revealed fourth quarter and yearly financial results which aren’t expected to improve this year.

With 107,000 employees currently on the payroll, a five percent reduction would equate to roughly 5,350 people losing their jobs this year. Intel spokesperson Chris Kraeuter said the reductions were designed to realign and refocus the company’s resources but failed to outline exactly which departments would be affected.

Chief financial officer Stacy Smith said in a recent interview that Intel has a long history of redeployment of resources and they will be making significant new investments in data centers, tablets, low-power chips and the Internet of things. As for data centers, Smith expects growth of between 10 to 15 percent – and probably on the bottom end of those estimates.

As the largest producer of chips for personal computers, Intel has suffered through the continued decline in PC sales just as OEMs have. The increase in popularity of tablets and smartphones are to blame. According to recent data from Gartner, shipments dropped 6.9 percent during the fourth quarter of 2013 as the market suffered its worst year ever.

Intel said the past few months have shown signs of stabilizing compared to a year ago but at the same time, net profit was down 13 percent year over year.




User Comments: 15

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ikesmasher said:

I still think intel overcharges and is why I havent bought anything from them.

2 people like this | Skidmarksdeluxe Skidmarksdeluxe said:

I still think intel overcharges and is why I havent bought anything from them.

A tech company that doesn't overcharge doesn't exist as as as I'm concerned. Take nVidia for example, they wrote the book on extortion yet they remain popular...

GhostRyder GhostRyder said:

I still think intel overcharges and is why I havent bought anything from them.

A tech company that doesn't overcharge doesn't exist as as as I'm concerned. Take nVidia for example, they wrote the book on extortion yet they remain popular...

Well overcharging is part of how companies can make back alot of money.

I think the problem here especially besides just tablets and the mobile market is the fact that Intel is not giving very compelling arguments to upgrade. When I find tons of people that are still running on Sand Bridge systems and have no intention of upgrading because its "not worth it" makes the problem more known. With only slight 5% increases over time it has made people more relaxed with upgrading and willing to wait till 3-4 generation pass or an increase above 10% that will be more noticed.

Guest said:

Well overcharging is part of how companies can make back alot of money.

I think the problem here especially besides just tablets and the mobile market is the fact that Intel is not giving very compelling arguments to upgrade. When I find tons of people that are still running on Sand Bridge systems and have no intention of upgrading because its "not worth it" makes the problem more known. With only slight 5% increases over time it has made people more relaxed with upgrading and willing to wait till 3-4 generation pass or an increase above 10% that will be more noticed.

Cool, now if that's Intel's excuse, then what's AMD's?

No, what I think the problem here is, is that Intel is a victim of their own success. They pushed so hard, with their tick-tock model, that they pretty much pushed AMD almost clear out of the high end market, much of the mid range as well. With their sights set on the immediate threat that was AMD, they failed to commit enough resources in the mobile arena. When Apple hit the headlines, it was already a bit late, but none-the-less they achieved their goal of taking the performance crown on the desktop, partly validated by Apple switching to Intel. Now, unfortunately, they are playing the catch-up game again. However, this is Intel we are talking about here. Playing catch-up and then crushing the life out of their competitors is what they do best, as evidenced by AMD, and other casualties over the years. Its a large ship to steer, to use an ocean going analogy, but when it does finally come round, its waves are going to slowly overwhelm and sink the smaller boats in its path.

Been a proud supporter of Intel for many years, even when everyone I knew jumped ship to AMD. I stuck it out with Intel, and now all those people are back to drinking Intel's cool aid again. Just cant wait to get my hands on a decent Intel powered smart phone. Hopefully it will come in the next year or two when they finally take on the larger markets.

cliffordcooley cliffordcooley, TechSpot Paladin, said:

When I find tons of people that are still running on Sand Bridge systems and have no intention of upgrading because its "not worth it" makes the problem more known. With only slight 5% increases over time it has made people more relaxed with upgrading and willing to wait till 3-4 generation pass or an increase above 10% that will be more noticed.
I'm happy with my Sandy Bridge, and will likely find it is more than enough processing power to satisfy my needs for many more years to come. It doesn't matter how much more powerful Intel makes their chips, this fact will not change. The idea of upgrading to the latest and greatest as each year passes, is becoming more of a desire than a need. Unless there is a spike in software that requires more hardware performance, this trend will continue. And now that people have grown accustomed to using their phone for all their processing needs, I doubt this trend will reverse.

Been a proud supporter of Intel for many years, even when everyone I knew jumped ship to AMD. I stuck it out with Intel, and now all those people are back to drinking Intel's cool aid again. Just cant wait to get my hands on a decent Intel powered smart phone. Hopefully it will come in the next year or two when they finally take on the larger markets.
Sounds like something I would say. Let me go ahead and echo the words as if I did say it.

GhostRyder GhostRyder said:

Cool, now if that's Intel's excuse, then what's AMD's?

No, what I think the problem here is, is that Intel is a victim of their own success. They pushed so hard, with their tick-tock model, that they pretty much pushed AMD almost clear out of the high end market, much of the mid range as well. With their sights set on the immediate threat that was AMD, they failed to commit enough resources in the mobile arena. When Apple hit the headlines, it was already a bit late, but none-the-less they achieved their goal of taking the performance crown on the desktop, partly validated by Apple switching to Intel. Now, unfortunately, they are playing the catch-up game again. However, this is Intel we are talking about here. Playing catch-up and then crushing the life out of their competitors is what they do best, as evidenced by AMD, and other casualties over the years. Its a large ship to steer, to use an ocean going analogy, but when it does finally come round, its waves are going to slowly overwhelm and sink the smaller boats in its path.

Been a proud supporter of Intel for many years, even when everyone I knew jumped ship to AMD. I stuck it out with Intel, and now all those people are back to drinking Intel's cool aid again. Just cant wait to get my hands on a decent Intel powered smart phone. Hopefully it will come in the next year or two when they finally take on the larger markets.

Ok well the problem with AMD was a poor choice to focus on in the high end market where they decided to jump on the whole "more cores = more power" phase and decided to take that to heart. The problem being was that while they focused on making chips with more cores Intel focused on Single core potential never exploring being a certain point (6 Core on the highest chip). Phenom II vs the First Gen i5's and i7's was putting Intel ahead but not by as much of a margin, however when Sandy Bridge faced off against the Bulldozer, the single threaded performance was sacrificed for 8 Cores working together when programmers decided that even in gaming using more than 2 Cores was too difficult or not worth it. That caused the 8 Core bulldozer to look pitifully slow at times because 2 Core from AMD < 2 Cores from Intel. When utilized properly, the 8 Core did its job with flying colors, but thats the big problem "When utilized properly". There are other things attributing to this but that not worth getting into on this thread.

I'm happy with my Sandy Bridge, and will likely find it is more than enough processing power to satisfy my needs for many more years to come. It doesn't matter how much more powerful Intel makes their chips, this fact will not change. The idea of upgrading to the latest and greatest as each year passes, is becoming more of a desire than a need. Unless there is a spike in software that requires more hardware performance, this trend will continue. And now that people have grown accustomed to using their phone for all their processing needs, I doubt this trend will reverse.

Sounds like something I would say. Let me go ahead and echo the words as if I did say it.

LOL, well your right and that's the big problem. If you include the higher overclock-ability (IE Sandy Bridge hitting 5.0ghz seemed easier than Ivy Bridge Hitting just 4.8) between the generations you notice that the gap has not really changed and it makes no reason to upgrade especially because you will need a new motherboard to go with that processor. Its too expensive for a mere if lucky 5% when you factor in overclocking between the generations for a whole 400+ dollars (Note im talking on the high end of course). In truth PC gaming is alive and well but people are just not feeling the whole upgrade chain anymore because of hiked up costs when the performance they are seeing is just fine.

BlueDrake said:

It's been pretty much said by everyone above. Granted a CPU might bring a slight gain at best, a GPU tends to be the bigger focus. Has there really been a bottleneck on any of the latest Intel CPUs, when you use any mid-range/high end of GPUs in the past while? I don't really see much benefit running from one CPU to another, when you place a 660 and up with it. Maybe a few frames at best, but usually it also depends on settings / resolution.

Guest said:

Blame Microsoft for introducing the lackluster Windows 8 platform for the decline in PC sales.

Guest said:

With smartphones and tables.. sure!!! intel sales are going to drop.... duh!!

Skidmarksdeluxe Skidmarksdeluxe said:

Well overcharging is part of how companies can make back alot of money.

I think the problem here especially besides just tablets and the mobile market is the fact that Intel is not giving very compelling arguments to upgrade. When I find tons of people that are still running on Sand Bridge systems and have no intention of upgrading because its "not worth it" makes the problem more known. With only slight 5% increases over time it has made people more relaxed with upgrading and willing to wait till 3-4 generation pass or an increase above 10% that will be more noticed.

I couldn't agree more.

cartera said:

Blame Microsoft for introducing the lackluster Windows 8 platform for the decline in PC sales.

There's always one....

It's been pretty much said by everyone above. Granted a CPU might bring a slight gain at best, a GPU tends to be the bigger focus. Has there really been a bottleneck on any of the latest Intel CPUs, when you use any mid-range/high end of GPUs in the past while? I don't really see much benefit running from one CPU to another, when you place a 660 and up with it. Maybe a few frames at best, but usually it also depends on settings / resolution.

This is a very good point, even the newest PC games run a breeze on my 2600k. The upgrade required is GPUs, and a GPU upgrade doesn't involve changing your motherboard and costing ~£500 (high end) providing you do not need to change your PSU.

cliffordcooley cliffordcooley, TechSpot Paladin, said:

There's always one....
Make that two!

Edit:

Make it more than two!

[link]

cartera said:

Make that two!

Edit:

Make it more than two!

[link]

Windows 7 is still available, I do not deny many dislike Windows 8 but a reason for the decline in PC sales it isn't.

1 person liked this | Railman said:

Make that two!

Edit:

Make it more than two!

[link]

Windows 7 is still available, I do not deny many dislike Windows 8 but a reason for the decline in PC sales it isn't.

W8 may not be the sole reason for the decline in PC sales but it is definitely a factor. Other factors include switch to tablets, the recession, slow rate of performance gains with new PCs etc.

cartera said:

I can see I may be losing this argument, but my opinion still stands.

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