News Intel Comments on Reports of New Layoffs, Budget Cuts in Client CPU and Data Center Groups

May 8, 2023
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Always sucks to hear someone is losing their job, for sure.

But big companies like this have to regularly trim off the fat. Tis the natural order of things.
It doesn’t really work like that. I had the joy (!) of working at Intel for a few years after they bought (part of) our company. Aside from the purchase being a <Mod Edit> - they bought Sw, and not the small/efficient hardware design team, and no actual IP - which puzzled many at Intel - a few years later some of us went c/o some general 10% division cuts (unintended voluntary redundancies in our small section), and a few more threw the towel in regardless of no settlement. A few years after that they closed the whole site because, as another 10% (?) reduction the site was ‘under 200’ - as a company we were never, ever, more than about 100, and that’s a good design team‘s size. A handful of guys went to the US but they spent a bucketload of money per person to achieve nothing.

It‘s very likely this will be very crude, poorly planned, and leave a heckovalot of replication and inefficiency elsewhere, because that’s what Intel looked like from a brief period as an insider - even access to up-to-date/version controlled specifications/documentation was a constant joke...it’d be on someone’s laptop in Folsom.

Thankfully for the folks at Altera, I think Intel largely left them alone when they were bought.
 
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cyrusfox

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I had the joy (!) of working at Intel for a few years after they bought (part of) our company. Aside from the purchase being a <Mod Edit> - they bought Sw, and not the small/efficient hardware design team, and no actual IP - which puzzled many at Intel - a few years later some of us went c/o some general 10% division cuts (unintended voluntary redundancies in our small section), and a few more threw the towel in regardless of no settlement. A few years after that they closed the whole site because, as another 10% (?) reduction the site was ‘under 200’ - as a company we were never, ever, more than about 100, and that’s a good design team‘s size. A handful of guys went to the US but they spent a bucketload of money per person to achieve nothing.
Intel is horrible at assimilating external companies and making a good investment on it... Look at all those AI companies, but by buying them they don't have to compete or worry about their competitors getting that competitive advantage? Maybe worth the $billions...
Thankfully for the folks at Altera, I think Intel largely left them alone when they were bought.
I think history is proving out your sentiment, if Intel allows the newly acquired company autonomy/independence, they seem to do quite well (Mobile-eye). If they are forced to become part of Intel, they tend to get infected by the same inefficiencies and are written off as a failure in 3-5 years.
 
May 8, 2023
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Intel is horrible at assimilating external companies and making a good investment on it... Look at all those AI companies, but by buying them they don't have to compete or worry about their competitors getting that competitive advantage? Maybe worth the $billions...

I think history is proving out your sentiment, if Intel allows the newly acquired company autonomy/independence, they seem to do quite well (Mobile-eye). If they are forced to become part of Intel, they tend to get infected by the same inefficiencies and are written off as a failure in 3-5 years.
The idea was they were buying expertise - we weren’t a competitor, Intel were behind in the mobile space...the sad thing was that the guys organising the sale at our end thought they were finding a relatively good home for the teams retained. Oh well..
 
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bit_user

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Intel is horrible at assimilating external companies and making a good investment on it...
I've heard this over and over and over again. Intel is like a venture capital firm with ADHD. It buys lots of companies, neglecting or dissecting most. Perhaps only about 10% really amount to anything, but if those 10% are at least 10x, then they consider the exercise worthwhile.

There's definitely a certain logic to it, but also a lot of unnecessary chaos and destruction. In better hands, Intel could at least offload most of those acquisitions which achieve profitability, without destroying them. It would produce more value for shareholders and the broader industry. But, I guess the execs are too busy tripping over each other to back the next big winner to care about the rest.
 

JamesJones44

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Intel is horrible at assimilating external companies and making a good investment on it... Look at all those AI companies, but by buying them they don't have to compete or worry about their competitors getting that competitive advantage? Maybe worth the $billions...

Almost all big companies are awful at this. I've worked for a few large companies and most of theses go really poorly, especially for tech companies run by wall st. CEOs. I remember when I worked for a large industrial conglomerate, myself and 5 others tasked with doing "due diligence" on a companies technology and the feasibility of integrating it with our existing software products. We all basically said making the systems work together was at best a multi year effort, at worst a 5 year effort and didn't think the acquisition would in the end achieve something another team couldn't build in the same time frame. It didn't matter of course the CEO said, we have great people we'll make it work and executed the acquisition anyway.

As you can imagine, years went by and the two systems were never integrated. The root cause you ask? Well the team on the existing product had commitments and did have or want to waste cycle on such a gigantic effort. On the other side the team on the existing product had commitments and did have or want to waste cycle on such a gigantic effort.

The brilliance of the wall st. CEO didn't bother to think of having a team tasked with the integration per the recommendation, nah, just figured the teams were "smart enough" to figure it. The company ended up splitting up and the two groups sold off separately. In the 7 years they were together, the two system were never integrated.

I've had similar experiences at other large companies, but that one was by far the worst.
 

bit_user

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We all basically said making the systems work together was at best a multi year effort, at worst a 5 year effort and didn't think the acquisition would in the end achieve something another team couldn't build in the same time frame. It didn't matter of course the CEO said, we have great people we'll make it work and executed the acquisition anyway.
It helps explain their actions, when you consider:
  • They typically have separate budgets for acquisitions and operations.
  • There are people whose entire job it is to do merges & acquisitions.
  • There are often executive performance targets based on doing a certain number of acquisitions per year.

This makes them intrinsically hostile towards internally developing a capability they can just go out and buy. They might also feel the latter route is less risky, if the acquisition has a proven track record, of some sort.
 
I've heard this over and over and over again. Intel is like a venture capital firm with ADHD. It buys lots of companies, neglecting or dissecting most. Perhaps only about 10% really amount to anything, but if those 10% are at least 10x, then they consider the exercise worthwhile.

There's definitely a certain logic to it, but also a lot of unnecessary chaos and destruction. In better hands, Intel could at least offload most of those acquisitions which achieve profitability, without destroying them. It would produce more value for shareholders and the broader industry. But, I guess the execs are too busy tripping over each other to back the next big winner to care about the rest.
I wonder how much of that is just to get their hands on new hardware and software IP, they need to make GPU and AI products (and so much more) and if a ton of startups already made a lot of the things that you need to do that and filed patents on the stuff then what are you supposed to do?!

Also thinking about it, would a viable company sell out to a big company?
A viable company (which can achieve profitability) can easily get loans or investors if they need money or is that not so simple?
So buy up a company that is close to ruin keep the things you need and dissolve the rest, harsh but realistic.
 

bit_user

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I wonder how much of that is just to get their hands on new hardware and software IP, they need to make GPU and AI products (and so much more) and if a ton of startups already made a lot of the things that you need to do that and filed patents on the stuff then what are you supposed to do?!
Well, a lot of the cases I've heard about are where they dabble in a market and then walk away. If they're no longer in that market, why do they need the IP?

Also thinking about it, would a viable company sell out to a big company?
Every single day of the week, and twice on Sundays! Founders and early investors often jump at the opportunity to "cash out".
 

wbfox

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The titans of industry who are completely blind past 3 months of the calendar at a time. At least Intel's founder died before he had to witness the complete self-immolation. Intel got into this situation in no small part to really really poor HR decisions. How do they not understand the people they let go will have no interest in ever coming back. And please pre-decline all future h1-b visa requests for the next 7-8 years. Because you know that will be part of the "recovery." Take back the CHIPS act money as well.
 
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Well, a lot of the cases I've heard about are where they dabble in a market and then walk away. If they're no longer in that market, why do they need the IP?
With CPUs becoming more and more all-included systems having more IP gives you more possibilities.
Also they make many many different things so they do need many many different IPs.
Also also you never let go of any IP if you have any say on the matter because you never know if you will have a use for it again in the future.
Every single day of the week, and twice on Sundays! Founders and early investors often jump at the opportunity to "cash out".
Well then that's an issue with the small companies just as much as with the big ones.
 

jp7189

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I wonder how much of that is just to get their hands on new hardware and software IP, they need to make GPU and AI products (and so much more) and if a ton of startups already made a lot of the things that you need to do that and filed patents on the stuff then what are you supposed to do?!

Also thinking about it, would a viable company sell out to a big company?
A viable company (which can achieve profitability) can easily get loans or investors if they need money or is that not so simple?
So buy up a company that is close to ruin keep the things you need and dissolve the rest, harsh but realistic.
Suppose you invest $10M in a startup and you think it'll be worth 100M in 5 years because they have a great product idea. Then someone comes along and offers you a guaranteed 50M right now.
 
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I can see we have at least one jack welsh disciple in here.

The term trimming the fat isn’t appropriate in this case because that’s not what they do they just slash heads regardless of how good of an employee you are

All in the name of their God, called money, whom they worship fervently
 
Suppose you invest $10M in a startup and you think it'll be worth 100M in 5 years because they have a great product idea. Then someone comes along and offers you a guaranteed 50M right now.
be worth 100M in 5 years
Meaning what?! Thet their equipment and plants will be worth 100M but they will be in the red because making their product is too expensive for them or making 100M of net money per year?! Or something else?!
Then someone comes along and offers you a guaranteed 50M right now.
Yeah if you only look 5 years ahead and think that your company will only ever be worth 100M you better sell right away.
All in the name of their God, called money, whom they worship fervently
Hey, if you don't worship money I can give you my paypal number and you can send me all of your money. Repent and cast off that evil money let me carry this burden for you...
 

ikjadoon

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The engineers that refused to assimilate into Intel mergers did quite well.

My all-time favorite example is CPU architect Dan Dobberpuhl.
  1. In 1997, Intel is gifted DEC's semiconductor unit, including their efficient, high-perf StrongARM microarchitecture via a lawsuit.
  2. StrongARM's CPU architect, Dan Dobberpuhl, refuses to commit to Intel. His RISC / ARM cores were world-class.
  3. In 1998, Dan founds SiByte.
  4. In 2000, Dan sells SiByte to Broadcom for $2.04 billion.
  5. In 2003 to 2006, Intel gives up StrongARM, unable to make a profit.
  6. In 2003, Dan founds Palo Alto Semiconductor, also known as P.A. Semi.
  7. In 2006, Apple almost transitions the Mac to P.A. Semi's ultra-efficient, high-perf CPUs, instead of Intel x86.
  8. In 2008, Dan sells P.A. Semi to Apple for $278 million.
  9. In 2009, Dan retires from Apple and joins Agnilux.
  10. In 2010, Google buys Agnilux for an unknown sum.
  11. In 2020, Apple designs in-house CPU architectures for all its devices.
Imagine how terrible Dan's life, and the semiconductor industry, would have been if he went to Intel. You can basically trace a direct line between Intel and the Apple M1 SoC.
 
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Hey, if you don't worship money I can give you my paypal number and you can send me all of your money. Repent and cast off that evil money let me carry this burden for you...
So you’re saying “I’m evil and that’s ok!” (From TIME CHASERS MST3k —Bob Evil) 😂

Also, your comment reminded me of the guy who wanted to take the ring from Frodo and bear the burden himself. Lol. Sean Bean’s character -Boromir. Same thing would happen. It would destroy your happiness

As Seneca said— referencing Epicurus

“enough will never be enough to the person to whom enough is too little “

Someone asked Jay Rockefeller how much was enough and he said a little bit more so I would say Epicurus and Seneca are completely on the money and have been from the very early days of mankind civilization

You know, I really would like to see everybody do well, and I hate to see people lose their jobs and people are way more important to me than money. right now my son is eating it all up with his college bills. We are paying for this one, but he’s gonna need to cover medical school.
 
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JamesJones44

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It helps explain their actions, when you consider:
  • They typically have separate budgets for acquisitions and operations.
  • There are people whose entire job it is to do merges & acquisitions.
  • There are often executive performance targets based on doing a certain number of acquisitions per year.

This makes them intrinsically hostile towards internally developing a capability they can just go out and buy. They might also feel the latter route is less risky, if the acquisition has a proven track record, of some sort.
Normally I would agree, but in this situation it was so poorly executed they ended up selling off both division at massive losses after competitors figured out ways to make similar systems work together and the company was no longer interested in the space.
 
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