They had the same dividend strategy since the early 90s. So they were insane for three decades and only now decided, "You know what? The fever dream is over, time to makes some reasonable decisions."
How long they've had it is meaningless. It happened to work out for them, because they enjoyed continued success in a rapidly growing market. It's when "the chips are down", so to speak, that bad ideas & policies are truly tested. Haven't you ever heard the term "creative destruction"?
They say specifically that they are cutting dividends to focus on new manufacturing capacity.
It came too late. They started having problems with their manufacturing progress, all the way back in the transition to 14 nm, which is why the Broadwell desktop SKUs got cancelled. That's when they should've sat up and taken notice that they were under-investing in their manufacturing. The trends have been clear for a long time that each new node is becoming more and more expensive to develop. Their cowardly management and unsupportive board just wanted to keep their heads buried in the sand and keep milking the cash cow a little bit longer, even if doing so was bad for its health.
Now, I don't want to focus too much on dividends, here . Their stock buybacks were also an issue, although I assume they probably justified to themselves that fewer shares would mean lower dividend payments and therefore a "good investment", right?
apparently 20 billion dollars was not enough.
It doesn't arrive all at once. It's spread over multiple years, so yeah it's not enough. Intel is still bearing the bulk of the costs, which would've been fine if its revenues had continued as they expected.
Lets wait and see how much of these billions of dollars from the government and the billions they will save in dividend payouts end up in the executive suites hands.
Most executive compensation is via stock. So, the dividend cut is a little more fair in that it hits them also (both directly and indirectly, if the stock price drops because of it).
Of course, I'm sure the stock buybacks were partially motivated by a desire to counter the dilution of shares via employee stock options. Which, as we know, largely tend to go to the executives.
I was specifically concerned with the American's that invested into the stock for dividends that also paid for, at least in part, the CHIPS act only to be slapped in the face.
Don't act so aggrieved. Investors are always (or should be) the first in line to suffer, when a company underperforms. It's the job of investors to account for the risks, when deciding which stocks to buy, hold, and sell.
Also, I don't really follow your logic about the CHIPS act. Its purpose was to
supplement Intel's own spending, so that the amount of US-based fab capacity can
increase. It was not provided as a form of corporate welfare to protect Intel's investors from its recent under-performance.
Intel is pillaging its dividend payout, and is planning on spending 20+ billion in tax payer dollars. I don't see how this can be considered positive for the average American with 100+ intel stock. Intel is down 16% in one month and 25% in 6 months.
It's called an
investment in future fab capacity, because they believe they can make that money back + profits. If they thought otherwise, they wouldn't be doing it.
The average American's investments are hurting from inflation and a post-pandemic tech hangover, more than anything. Intel is just a small part of that.
If people are investing for the long term, Intel will probably continue to be sound investment. If you just wanted dividend payments, well... you should've seen the writing on the wall when they first started posted big losses. Good investing takes effort. "The market" knew all was not well, hence the under-performance of their stock price.
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