Posted on 09/01/2006 10:44:21 AM PDT by nickcarraway
Intel Chief Executive Paul Otellini is expected to announce a massive layoff as soon as Tuesday that could eliminate as many as 10,000 jobs, CNET News.com has learned.
The Santa Clara, Calif.-based chipmaker, having suffered several financially disappointing quarters, launched an internal analysis in April to find ways to increase its efficiency. Otellini is scheduled to announce the results of the analysis, including the layoff, on Tuesday after the stock market closes, sources familiar with the plans said.
Intel has about 100,000 employees worldwide, so the cut could be as high as 10 percent of the company's staff.
The job cut is likely to weigh particularly heavily on marketing staff. Intel studies comparing its own staffing levels to competitors' concluded that the ratio of marketing personnel to salespeople was too large, the sources said.
The expected cuts won't be the first big change in sales and marketing. That group previously was led jointly by Eric Kim and Anand Chandrasekher, but in July they moved to different roles and Sean Maloney was appointed sole leader.
Intel declined to comment on the layoff plan. The company has committed to announcing the analysis results by the end of September, spokesman Chuck Mulloy said, but added, "We have not communicated publicly what the plans are with respect to that."
Most companies would love to have Intel's financial results--for example, the $885 million in net income and $8 billion in revenue the company reported for the second quarter. But compared with the year earlier, that net income figure was a 57 percent drop and the revenue a 13 percent drop. And Intel has had to warn of lowered financial results.
Part of the problem: The chipmaker has lost share to rival Advanced Micro Devices, in particular in the server market where chips are sold at higher prices. AMD rose from having no server products three years ago to claim 26 percent of the x86 server processor market in the second quarter, according to Mercury Research. AMD now sells chips to all of the four major server makers.
In other news: Apple, Microsoft music codes hacked Web giants lure developers A revamping Intel braces for layoffs News.com Extra: Netflix setting indie films free Video: Gentlemen, start your (car search) engines Intel hopes to reclaim its share with new Xeon server chips such as Woodcrest and Tulsa. It's also been fighting back with competitive Core processors for personal computers, aggressive chip prices, and plans for quickly introducing new technology.
The efficiency plan already has wrought major changes at Intel:
• The company reshuffled of top executive ranks in July, giving new jobs to most of those who reported directly to Otellini.
• It laid off 1,000 managers earlier in July, saying the move would speed decision-making.
• It sold its Xscale communications and applications chip business to Marvell Technology Group in June, reducing its work force by 1,400 positions.
• It sold its telecommunications business to Eicon Networks in August, trimming another 600 jobs.
Maybe they'll do it via email like Radio Shack...
Probably cut jobs in the US, and a couple weeks later hire the labor in India.
That's awesome! That'll teach those lazy Americans! Oh, wait, marketing types? That's different, I thought it was lazy workers or engeineers...
Now tears can be shed at FR.
/ sarcasm off
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Exactly, you understand the goals of globalism and the new world order.
Athlon RULES !
I wonder how many of the 10k I can expect to be competing directly with for open positions in the area.
Two intels and I have had it. They are overpriced, slow and run hot as my stove. Upgraded to an Athlon 3700+ ..works like a dream.
With the way California is interfering with business many businesses will likely conclude they would be better off where they are appreciated.
Intel's newest CPUs, the Core Duo 2 and Core Duo Extreme, crush anything AMD has to offer, and at a much cheaper price. And I say that as a long-time AMD fanboy.
Is that the one with a duck as a mascot?
Indian marketing staff? That's downright scary.
When that contract expired Intel management decided that letting other chip makers like AMD make Intel products was not a good thing to do. They felt that only Intel should make Intel products.
Any one with an I.Q. larger than their shoe size should have figured out that AMD was not going to just close their doors. They were going to make their own CPUs and someday they just might made better ones than INTEL.
The question was, "Is Intel going to get a royalty on every CPU AMD makes or is it going to get Zero percent of every CPY AMD makes?" Believe it or not INTEL management chose the latter.
Today INTEL is losing market share to AMD and their product line is not all that competitive with AMDs.
INTEL created their own competition. That is not something people with a large I.Q. tend to do. And dumb people tend to hire dumb people to create products. The only thing worth while in the pipe line is pipe.
This is just one of many cost cutting actions. They will likely keep cutting costs ... until.. "Will the last employee at INTEL please turn out the lights?"
The BIGGEST foulup ever at Intel was "Vin Dahm" who used his power to coverup the floating point bug. He did it only to Maximize his personal stock options.
A couple years later, he jumped ship to AMD only to get his butt kicked out of there too.
Sure you do ... a company with great products always cuts marketing.. that way they can prevent the word about their wonderful new products from getting out.
That is what MBAs always do. They wait for the new product guys to produce. When they don't they have no need for all the marketing that was required when there were lots of new products. So it can be cut with no apparent loss. Of course once marketing is cut then sales go down and lots of sales people are no longer needed.
Then with all the excess inventory they can cut production staff and that allows them to cut management.
What part of the start of the belly up spiral don't you understand?
bump
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