Intel’s global layoffs hit California, with 272 workers in Folsom and 47 in San Jose losing their jobs
California – Intel, the renowned tech giant based in Santa Clara, has started a round of layoffs that will result in the loss of jobs for hundreds of its workers in California. This move is part of a larger plan to cut its global workforce by 15%, which will affect about 15,000 jobs around the world.
Following a written notice to state governments under the Worker Adjustment and Retraining Notification Act, the layoffs were made public on Tuesday. In California alone, 272 people will lose their jobs in Folsom and 47 will lose their jobs in San Jose. This wave of layoffs goes beyond California; big job cuts are also happening in Oregon, Arizona, and Texas, showing how broad Intel’s choice is.
Intel’s move to lay off workers is part of a larger plan to cut costs after poor financial results. With sales of $12.8 billion, a 1% drop year-over-year, the company’s second-quarter earnings were slightly lower than the same time last year. Because of this, Intel wants to cut costs by $10 billion to improve its cash flow and get its finances back on track. This includes stopping dividend payouts, demonstrating how bad the financial changes Intel has to make are.
In a memo to workers, Intel CEO Pat Gelsinger made it clear how important these changes were by calling them “some of the most consequential changes in our company’s history.” Gelsinger’s message underlined the necessity to align the company’s cost structure with a new operational model in order to deal with slow sales growth and take advantage of new trends like artificial intelligence, which haven’t fully helped Intel yet.
These layoffs have big effects on Intel’s position in a very competitive business as well as on the people who lost their jobs. The company has been a mainstay in Silicon Valley for decades, but it is now behind stars in its field, like the Taiwan Semiconductor Manufacturing Company, in making chips and Nvidia in designing them.
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The company’s stock success makes this competitive disadvantage very clear. Even though the tech industry as a whole has done very well, Intel’s stock has dropped more than 50% since the start of the year. In the same time period, Nvidia’s stock has gone up by more than 170%, further putting pressure on Intel.
Californians are losing their jobs, and the first group of people leaving Folsom and San Jose is set to take place in the second half of November. It is important to note that these workers are not part of any union, which could affect the terms and conditions of their departure.
Even though things are tough, Intel recently got a big $3 billion deal with the U.S. Department of Defense and is actively looking for more public funding to improve its resources. These funds are very important for Intel as it tries to catch up in a field where new ideas and quick changes are necessary to stay in business and grow.
As Intel moves through this period of transition, it remains to be seen how its efforts to restructure will affect its employees, its standing in the industry, and its overall financial health. The next few months will be very important for the company as it tries to adapt to the rapidly changing needs of the global tech scene.