The process will be executed over the next 60 days with some actions spanning into 2017.
As Intel Corporation dons a new avatar—of a company that powers the cloud and billions of smart, connected computing devices—different from the earlier one of being a PC company, it has decided to reduce its current strength of 1.1 lakh employees by 12,000.
This means, around 11 per cent of its employees will lose their jobs by mid-2017. These changes will be made through site consolidations worldwide, a combination of voluntary and involuntary departures, and a re-evaluation of programmes.
The majority of these actions will be communicated to the affected employees over the next 60 days with some actions spanning into 2017.
In an e-mail to the employees, Intel CEO, Brian Krzanich said, “Our results over the last year demonstrate a strategy that is working and a solid foundation for growth. The opportunity now is to accelerate this momentum and build on our strengths. These actions drive long-term change to further establish Intel as the leader for a smart, connected world.”
“I am confident that we’ll emerge as a more productive company with broader reach and sharper execution,” he added.
Intel expects the programme to deliver $750 million in savings this year and an annual run rate savings of $1.4 billion by mid-2017. The company will record a one-time charge of approximately $1.2 billion in the second quarter.
Bill Conerly, of Conerly Consulting, called this a case of mismanagement in his article. According to him, the process could have been a gradual one, spread over the last few months.