(Reuters) – Intel Corp said on Thursday it would cut more than 15 percent of its workforce and suspend its dividend starting in the fourth quarter as the company continues its turnaround.
In after-hours trading, shares of the Santa Clara, Calif.-based company were down about 20 percent.
The bulk of the job cuts will be completed by the end of 2024, Intel said. The company had 124,800 employees at the end of 2023.
Intel also plans to reduce its operating and capital expenditures by more than $10 billion in 2025.
The company expects its capital expenditures to be between $25 billion and $27 billion in 2024, and expects its gross capital expenditures to be between $20 billion and $23 billion for 2025.
In February last year, the group committed to achieving annual savings of $8 billion to $10 billion by 2025.
“Our goal is to get back to the dividend, to pay a competitive dividend over time, but right now we’re focused on the balance sheet, reducing leverage,” Intel Chief Executive Patrick Gelsinger said.
The company also said it expects third-quarter revenue to fall short of market expectations as it faces a decline in spending on traditional data center chips and increased competition in the personal computer market.
Intel expects revenue of $12.5 billion to $13.5 billion in the current quarter, compared with analysts’ expectations of $14.35 billion, according to LSEG data.
(Arsheeya Bajwa; Camille Raynaud)
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