Chip giant Intel has begun the process of trimming more than 15,000 jobs from its workforce around the world as part of a big cost-cutting plan to get the company back on track.
Intel said last week it would cut more than 15 per cent from its workforce worldwide and suspend its dividend in a bid to slash costs and turn around the once-leading chipmaker’s business. The restructuring is hoped to save $10 billion in 2025.
The company said it would offer early retirement and voluntary redundancies to staff, with the packages varying according to location.
Irish-based workers are understood to be waiting for further detail on the scheme, which could see hundreds of people leave the company. A final figure has yet to be set for Intel Ireland staff, and it could be several weeks before the full scale of the departures is known.
Elsewhere, reports indicated that staff at the Israel operation would get four months’ salary for up to five years of service, those with the company for more than 10 years will get 10 months salary, while those who have been working with Intel for more than 30 years will get 19 months of salary.
In the US, media reports claimed staff had been offered payouts that amounted to between 13 weeks of pay to more than a year, depending on length of service. Oregon newspaper Oregon Live said staff were being offered voluntary redundancy packages of 13 weeks of pay plus 1.5 weeks for each year they have worked for Intel. Bonuses would be prorated and staff would also get a year of healthcare benefits. The paper also said those opting for early retirement would get an extra eight weeks of pay, along with bonuses and healthcare benefits.
However, there is little detail so far on the plans for Intel’s Irish workforce, which stands at more than 5,000. A spokeswoman for the company did not comment on the potential financial incentives that would be open to staff employed here, although the company said it would be following all local laws when implementing the packages.
The company has invested billions in its campus in Leixlip, Co Kildare, where it recently opened Fab 34 to manufacture its new generation of chips that it said would usher in an “AI revolution”. But the company has stiff competition from Nvidia and AMD, who have made significant headway in a processor market that was once dominated by Intel.
The chip giant failed to capitalise on the mobile revolution that propelled rivals such as ARM to significant growth, and has yet to see sustained benefit from the growth in demand for computing power to run artificial intelligence systems.
Under chief executive Pat Gelsinger, Intel is attempting a bold turnaround plan that will transform Intel into a contract chip manufacturer that also designs and makes its own chips. But last week the foundry unit disclosed deepening operating losses, losing $7 billion in 2023 after recording $5.2 billion in operating losses the year before. Revenue for the unit was $18.9 billion for 2023, down 31 per cent year on year.
- Sign up for Business push alerts and have the best news, analysis and comment delivered directly to your phone
- Join The Irish Times on WhatsApp and stay up to date
- Our Inside Business podcast is published weekly – Find the latest episode here
