News Intel CEO will reportedly present plans to cut assets at an emergency board meeting — chipmaker may put $32B Magdeburg plant on hold and sell off A...

[Admin]

Intel CEO Pat Gelsinger is expected to meet with the board of executives this month to share potential plans on what to cut from Intel to turn around the company. Intel's Foundry wing will not be on the chopping block, but Intel's in-progress Magdeburg fab will likely be canceled.

Intel CEO will reportedly present plans to cut assets at an emergency board meeting — chipmaker may put $32B Magdeburg plant on hold and sell off A... : Read more

 

[Neilbob]

But hey, at least AMD is in the rear-view mirror. Whee!

Sorry, I couldn't help it. But it is an appropriate reminder to never, ever take the statements of a CEO too seriously. ANY CEO.

 

[ekio]

I hope the corporate will have the decency of decreasing their salary by a factor of at least 10, their work has been such a failure. They should even quit on their own an apologize to the staff.

 

[-Fran-]

Bean counters needing that short term money to bail out the shareholders, so they can cash out and shorten Intel into nothingness. Well, that could be a potential extreme, but that's how it would roll if Intel didn't have anything left, which I'd say they have plenty left to survive.

Sad to see Intel being stripped appart to cover the incompetence of the current c-suite managers at the company, but that is what happens when you have no real leadership for a while. After Otelini left, it was pretty much every person on their own, it looks like. Zero corporate responsability and accountability. I mean, just look at BK's exit. That was a real crapshoot.

Regards.

 

[hotaru251]

to be fair..any mega corp on top 500 list should be required to slash the top heads pay before selling off/fireing ppl in mass.

You should never reward the top brass for their failure in leading a company properly.

 

[Thunder64]

Good thing they did all those stock buybacks rather than invest that money into R&D or their workers, or fabs? Anything really.

 

[bit_user]

Good thing they did all those stock buybacks rather than invest that money into R&D or their workers, or fabs? Anything really.

Yeah, they simply inflated a stock price that they're now having to take desperate measures to prop up. If they'd done as you said, then the stock would've languished more in the short term, but the long-term health of the company would be better.

IMO, the vesting schedules of executives' stock options needs to be longer, so they take a more long-term focus on the company's health. Boards will never do that, because boards represent investors' interests and investors are to short-term focused, these days. It would probably take the SEC to issue such a ruling.

 

[Dustyboy1492]

Seems necessary, the foundry side has more employees than TSMC and the design side has more employees than AMD or Nvidia, something needs to give. Cut the side projects and get lean, focus on the core business and bringing up the new fabs.

 

[DavidLejdar]

If I were on Intel's board of directors (such as appointed by an emergency shareholders' meeting), I would remind everyone there, that by end of June, year-on-year revenue was up 1.99%, compared to the previous year. And $55B may not seem much, compared to the $79B at the end of 2021. What is interesting though, is that $55B is as much yearly revenue as at the end of 2015. Yet, while at end of 2015 the gross profit was $34B, at the end of last June it was less than $23B.

And before hitting an eject or self-destruct button, that's something that would seem worth a closer look at. Like, did the production costs increase heavily, and that perhaps due to inflation? Did U.S. import duties, and/or export restrictions, have an impact on business? I.e. when Intel China had import/export with Intel elsewhere, did the like company supply lines get affected? And stuff like that.

After all, if Intel wants to stay global, that requires some attention. You know, instead of perhaps just relying on that AI is going to carry the day, despite not really (yet) offering that a strong argument about why one would want to upgrade e.g. to a new laptop (or buy the more expensive one), just because of some MS Copilot feature, when the old laptop just works fine for the few office applications, and in a climate of layoffs at that, while these layoffs may perhaps not be that necessary, when there would be more focus on the business-side of the business.

I.e., people like practical, right? And how practical would it be, if there was a long box (with CPU, iGPU, NVMe), that could easily be plugged in e.g. behind the screen from above? I mean, that may perhaps get a perplexed reaction from a focus group (in market research). But, not every desktop user is necessarily a gamer, or is a gamer, but not at work. And thanks to NVMe, less space needed. So, what could technically be offered, is that one doesn't need more space than e.g. for an 27- or 32-inch screen, to be able to run a desktop setup (with iGPU) - and with less cables at that... just one power-plug, and USB ports at the foot of the screen.

 

[bit_user]

Seems necessary, the foundry side has more employees than TSMC

Has TSMC surpassed Intel's wafer volume, yet?

Also, Intel has done their own in house EDA tools, whereas TSMC works with partners like Synopsis. It's possible TSMC also outsources other things that Intel does in house, so the numbers might not be exactly comparable.

the design side has more employees than AMD or Nvidia, something needs to give.

Is that counting Altera and MobilEye? Also, exactly when were these numbers taken? For AMD's part, do they include Xilinx?

Cut the side projects and get lean, focus on the core business and bringing up the new fabs.

I've only heard of Gelsinger cutting projects and selling things off, since he came on board. They haven't gotten into any new businesses or started any major new projects, since then. That's why they're at the point of having to dump assets, now. There's not much more they can cut which doesn't affect their core strategy.

 

[vanadiel007]

Well, there's always the option to form a joint venture with AMD and compete against Nvidia.
I bet nobody would have seen that one coming.

 

[bit_user]

If I were on Intel's board of directors (such as appointed by an emergency shareholders' meeting), I would remind everyone there, that by end of June, year-on-year revenue was up 1.99%, compared to the previous year.

The industry was still in a slump, 1 year ago. You'd naturally expect revenue to be up. The thing to do is compare with the market, overall. If they're not growing as fast as the competition, that's not sustainable.

before hitting an eject or self-destruct button, that's something that would seem worth a closer look at. Like, did the production costs increase heavily, and that perhaps due to inflation? Did U.S. import duties, and/or export restrictions, have an impact on business? I.e. when Intel China had import/export with Intel elsewhere, did the like company supply lines get affected? And stuff like that.

Good questions, but they're not n00bs. I'm sure they understand their business well enough to know what changed and how the current trends are likely to play out.

how practical would it be, if there was a long box (with CPU, iGPU, NVMe), that could easily be plugged in e.g. behind the screen from above?

You mean like the VESA adapters that let you attach a mini-PC to the back of a LCD monitor? Those have been a thing for like 10-15 years and the mini-PC market was developed by Intel via their NUC product line (which Gelsinger sold off to ASUS, BTW).

 

[bit_user]

Well, there's always the option to form a joint venture with AMD and compete against Nvidia.
I bet nobody would have seen that one coming.

That would flout anti-monopoly and anti-collusion rules. 0% chance of it happening.

Plus, with AMD on the rise, what would be in it for them? Why would they want to weigh themselves down by having to carry Intel?

I guess the closest they came to this was the Kaby Lake-G product, where Intel integrated a Vega (actually Polaris?) die on-package, in a laptop processor (with HBM for the GPU). That was in like 2018, before Intel had their own dGPUs. But, AMD was still tiny and struggling, back then. Not the competitive threat they are, today.

 

[JRStern]

Would Gelsinger like to return about 90% of his compensation since rejoining?

While I'm sure these moves are well justified, I can't help suspecting there is some big piece of bad news that's triggering it now.
Some expected progress will be pushed off, some big orders cancelled, some big competition about to announce. Something.
Yet the stock was *up* on Friday on these rumors.