Intel said today it plans to cut costs as it grapples with falling profits linked to shrinking market share and slowing computer sales.
Intel chief executive Paul Otellini said he is launching a top-to-bottom review of the company's operations amid intense competition from smaller rival Advanced Micro Devices.
"We are very well aware of the realities of our current and future business outlook and we are taking actions to address these realities," Mr Otellini told an analyst meeting in New York being broadcast over the Internet.
"No stone will remain unturned," Mr Otellini said, adding that Intel would conclude the review in the third quarter.
The review raises the possibility that the company which employs nearly 100,000 people worldwide, could cut jobs and drastically overhaul key parts of its business, which covers PC processors, memory chips, and other kinds of semicondutors.
"It sounds like job cuts is a piece of it and I think they are looking at whole business units, asking 'Is this efficient'?" said Credit-Suisse analyst Michael Masdea.
Intel has previously sought to reverse its diminishing fortunes by touting its upcoming line of more powerful and energy-efficient computer chips that should close the gap with AMD's products.
But despite generally positive reviews of the new products, Intel's stock has languished, trading about 15 percent below where it was a year ago.
Facing an expected 3 percent fall in revenue this year, to $37.7 billion, Otellini said he is scaling back planned spending by about 8 percent, to a level roughly even with last year's $11 billion.
The news that Intel is getting serious about trimming the fat out of its business helped send its stock up 2.5 percent to $19.98 on the Nasdaq today.