Intel to cull thousands of jobs amid sales slowdown

Intel is set to cull thousands of staff as the chipmaker attempts to fight off a sales slowdown.

According to initial reports from Bloomberg, the layoffs will be announced as early as this month, slimming back its 113,700 global headcount.

Sources told the publication that the sales and marketing teams could see as many as 20 per cent of its staff cut.

In July, the company warned that 2022 sales would be about $11bn lower than previously expected as PC processor sales slump and rivals swarm the market.

However, it’s not just Intel that’s having a tough time.

Shares continued to tumble this week, as the sector feels the hangover of Washington’s decision to limit chip exports to China.

On Friday, US President Joe Biden blocked American firms from selling chips for use in AI and supercomputers in China.

He said these curbs were aimed at blocking Chinese military advances and tech.

The politically-charged move sent shares into a frenzy, with US semiconductors losing a combined $240bn in market value globally since it was first announced.

Intel’s shares have tumbled over eight per cent in the last week.

The European chief of Intel warned back in August that hostilities between the US and China over Taiwan could choke off the global supply of electronics like mobile phones.

Speaking to the Sunday Telegraph, Intel’s European chief Frans Scheper said shutting off Taiwan’s exports would have a “huge impact” and could cause a “major crisis”.

“If you think about mobile phones, 80-90pc of chips are coming from Asia, from that specific area,” Scheper told the newspaper.

“For certain applications it would have a huge impact. Maybe for others a little bit less, but there are not always alternative sources available.”

Scheper said that the firm was now ramping up its investment in manufacturing facilities in a bid to stave off potential disruption.

“We are making major investments in Europe and in North America to get more balance,” Scheper said.  

However, he warned that the investment would do little to mitigate short term disruption. 

“If there is a short term crisis, there’s not much you can do in that sense, so that would have a major impact,” he said.

A spokesperson for Intel said the firm does not comment on rumours or speculation.