Regarding the impact of layoffs on its China operations, Intel told Time Weekly, "This reduction measure is global. The company will not disclose the number of affected employees by specific region or location." Intel stated that the company is working hard to accelerate its strategy while significantly reducing costs. They plan to cut costs and improve efficiency through various measures, including reducing positions in some business and functional departments across the company.
According to Intel's (INTC.O) financial report for the second quarter of 2024, the revenue for the second quarter was $12.8 billion, a 1% decrease year-over-year, with a gross margin of 38.7%. According to Generally Accepted Accounting Principles (GAAP), the net profit loss was $1.6 billion. Intel’s much-anticipated foundry business reported revenue of $4.3 billion, a 1% decrease quarter-over-quarter.
The release of this second-quarter financial report triggered a chain reaction. Intel's stock price plummeted by 26% on Friday, dropping to $21.48. According to media reports, this is Intel's largest single-day drop since 1982.
On the same day, U.S. tech stocks generally fell, with all three major indices closing sharply lower. The Dow Jones Industrial Average closed down 1.21%, the Nasdaq Composite Index closed down 2.30%, and the S&P 500 closed down 1.37%.
Intel CEO Pat Gelsinger stated in the earnings report conference, "Despite progress in products and processes, the profitability in the second quarter was disappointing."
On the day of the financial report release, Intel posted a notice on its official website in which Pat Gelsinger stated that Intel would lay off at least 15% of its workforce as part of the company’s $10 billion cost reduction plan. "I do not expect the road ahead to be smooth. Neither should you. Today is a difficult day for all of us, and there will be more difficult days ahead."
Pat Gelsinger believes that "not fully benefiting from strong trends like artificial intelligence" is one of the reasons Intel's revenue fell short of expectations.
