August 5, 2024 /SemiMedia/ -- According to Reuters, Intel announced plans to cut more than 15% of its workforce and suspend dividends to shareholders starting in the fourth quarter.

As of June 29, Intel's total number of employees was 116,500. The layoffs will affect approximately 17,500 people, and most of the layoffs will be completed by the end of 2024.

The report pointed out that in addition to layoffs, Intel also announced other restructuring measures and plans to reduce capital expenditures, which are expected to cut costs by $10 billion by 2025. In order to save money, Intel also said it would suspend dividends in the fourth quarter. This is the first time Intel has suspended dividends since it continued to pay dividends in 1992.

Intel's Chief Financial Officer Dave Zinsner said in an interview that financial conditions were not where the company wanted them to be and that the layoffs were necessary to have a more sustainable model for future business.

In addition, Intel plans to cut spending on new factories and equipment by more than 20% in 2024. The current budget is $25 billion to $27 billion, and spending next year will be between $20 billion and $23 billion.

Bloomberg noted that despite CEO Patrick P. Gelsinger's massive spending plan, he still struggled to improve the company's products and technology quickly enough to retain customers.