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So they got all that money from Uncle Sam’s CHIPS Act only to lay off 10,000 employees and make themselves “lean”. Govt funded unemployment.
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This is an admisson of no future.
They’re throwing crew out of their boat full of holes to assure investors they’re ship shape… for the next quarterly profit report.
Their corpse will be long since picked clean of their patents, assets, and trademarks by 2030.
There’s no corporate death penalty, but there is corporate death from alcoholism, coke overdose and syphilis.
I mean, you do a TRAFU and instead of firing those logically responsible for it you fire your actual troops.
This basically means they failed to find scapegoats inside the company who wouldn’t be management themselves.
Wow.
Didn’t expect CHIPS to backfire this fast lol.
I don’t think it backfired…I truly don’t believe the Chips act is a jobs act. It is to address manufacturing gaps in semiconductors within the US. The US government wants semiconductor manufacturers to update foundries and gave them money to do so. The jobs that have been added within the industry have been icing on the cake but not the original intent imho.
Is this really a backfire? My read is that they’re actually focusing on their core business (plus cutting down marketing). It sounds like the right move, but maybe I’m too optimistic?
Chips Act, Take 1: Hey Intel here’s 8 Billion dollars to make us more chips in the US. Intel: I gotta let 15,000 of you go, there’s just not enough money…
The CHIPS plants just started being built a few months ago. This is bad for the employees and short-term investors, but long-term Intel will be fine and the plants will be a net positive to the country.
I thought they would be more tacit about it. This is too obvious and too soon after taking taxpayers’ money. But they probably don’t care anyways. Who is going to stop them or hold them accountable?
It got us a TSMC fab, soon ish maybe lol
Non essential work, oh dear Product and Project managers, where are you gonna stand in the way of good products next?
Executives will be “essential”, QA, sys admins, etc will be non essential.
Eliminating QA is a huge value. We all know it reduces costs relating to employing people, but that’s just the start. It eliminates the number of bugs found and reduces the amount of work that comes with it. All in all it helps projects to release on time. There could be no problem with this, clearly.
All my KPIs are saying this is a win.
If you don’t check it, it never fails a check!
What’s there not to like?!
Traditional QA is horse and buggy shit anyway. Shift left and make your tests the requirements (ATDD). Testing is self service, automated and there’s zero delta between behavior intended and behavior tested. Put product owners on the hook to learn Gherkin and Bob’s your uncle.
FIFTEEN THOUSAND HOLY SHIT
Seems like a great time to buy AMD, ARM and QUAL
Only if you have conviction. Buying tech in the face of recession fears is one thing, but buying tech that supplies hardware to tech is another. It’ll probably sound like a whip cracking if the AI frenzy ever collapses hard
ARM and Qualcomm aren’t really involved with AI, and AI only makes up 15-20% of AMD’s revenue. Nvidia the one to watch out for, an entire 85% of their revenue is just AI and Mellanox. The Nvidia pump has been insane.
The elephant in the room is the semiconductor ETF trade. People are actively trading ETFs more than actual tickers (SOXL is routinely one of the highest volume tickers day in and day out, and it’s been like this for a couple years now). Used to be that NVDA and AMD correlated with crypto because people would flip them on that basis, but not really the case anymore due to all that but I digress - if NVDA tanks, it’s really overweight in all these ETFs, ETFs tank, managers dump every holding in the ETF, and a bunch of non-AI semi stocks will wind up getting walloped about as hard
That’s true, Nvidia’s fall will probably crash the whole market. SOXL tickers don’t trade in unison though, see how much Intel fell in the premarket without affecting other stocks. Of course, Intel is a tenth of the size of Nvidia.
Yeah, the tail could definitely wag the dog. NVDA is now in the top 3 holdings of both SPY and QQQ, so if something like 2 Metas or 1 Microsoft started paring back and skipped on a product cycle, Nvidia’s forward metrics would suddenly be garbage, and between those couple companies, suddenly >15% of market is tanking and dragging entire sectors along for a wild ride
Nvidia’s AI gambit is at least diversified to different kinds of AI. Even if (or probably when) LLM AI taps out, Nvidia will likely also be behind the AI tech that takes its place.
I honestly don’t think investors can tell the difference between LLMs+SD and more useful neural networks like audio and video filtering tools. All the money is in LLMs, anyways, I don’t think anybody is buying $1B of datacenter CPUs for the more useful kinds of AI.
As a 30-year-old trying to break out into a tech career, this is incredibly disheartening.
Really difficult to not give up all hope with headlines like these. How to believe in potentials for opportunities with these barrages of bad news? Where is the hope–Any silver linings at all?What kind of tech are you trying to get into?
Intel is a failing company and has been for years, it has nothing to do with the tech industry. They failed to invest in chip fabrication, and their designs are soundly beaten by AMD and Nvidia. Look at AMD and Nvidia, they’re making record profits and hiring.
Also, the tech industry is a huge place, there are plenty of opportunities outside of the hardware niche that Intel operates in. I will admit though that the current interest rates and risk of recession does make it harder for junior programmers.
They are doubling down on that mistake it would seem. Article says most of their losses last month were from their foundry division. I realize I’m just a random person on the ground, but shit like this really has me shaking my head. For a company like Intel foundry is absolutely essential to their business. If they can’t build the chips, build them better, faster, smaller, they can’t compete. It’s like if Airbus said they are firing everybody in their airplane division to focus on important things. What the hell, the airplane is the important thing. Same thing with Intel.
Seems like a great time to buy stock in AMD.
Yup. A better simile is Boeing. Quality don’t matter if cutting it makes number go up. Oops.
John Deere smiles and waves from the sidelines.
Well it’s cannibalizing the company. You’re absolutely right about Boeing.
HP was another example. Fire all the engineers and R&D types, rush whatever’s already in the pipeline into production. You get a couple of fantastic quarters because you have new products without the R&D costs. But then you run out of new products in the pipeline and everything goes to shit because you killed your golden goose.
I will always say, “Fuck Carly Fiorina” for ruining the finest company in the engineering world.
Absolutely. What she did to HP was almost criminal.
HP, Boeing, Intel (twice now)…
As the OP said, get a job outside of tech.
The biggest research hospitals employ electronic engineers, software engineers, chemical engineers, physicists, statisticians, network engineers, sysdamins, etc.
Insurance companies? Auto industry? Power companies, pharmaceuticals, local governments etc. The best part about being a STEM is that you have a place everywhere. You just gotta be willing to bend your expectations until you find something that fits you.
But how do I find those jobs? When I search in Indeed all I get are tech companies or MSP’s. I’m currently working as a sysadmin for a Mom & Pop company and are severely underpaid.
Find something middle sized. I work in a bakery, around 200 employees. I do some industrial automation, in house IT support and I ended up writing ERP for the joint. I think I could get 20 to 30 percent more at a larger company but here I do what I want and not what I’m told to.
My dude, if you lived in the right city, could pass a drug screen, and are not a moron, could get you an interview for a job installing power grid equipment in a week. With overtime take home pay is usually around 80k first year, after that it depends on how much you want to work.
We have blue collar guys making 250k+ a year. Granted they are away from their home most of the time, but most of them are younger dudes with no family.
Apply to non-tech companies. There ate many companies who aren’t in the tech sector that relies on in-house tech.
You like tech? You like wiring up and programming state-of-the-art commercial automation, access control, and cctv systems? You like to move around as well and work with your hands and tools, all on the same job? Become an electronic security technician. Been doing it for 20 years, it’s great, and always hiring, almost never firing, unless you get caught smoking meth or something.
Nothing wrong with a more blue-collar style job.
This sounds beyond ideal–I don’t know if you’re trolling, because I have to imagine this line of work is never in demand at all, but hoping for interviews soon, and I can’t thank you enough even if you’re joking
Similar job is power grid installation. Those are in high demand, and you get yourself a passport and you can make even more setting up transformers in weird places in the world after a few years experience.
I work in the industry and my understanding of the chips act is certain goals must be met in order to receive money. Something like in order to get this 50 million, you must buy 100 million of new equipment and facilities improvement. In order to get this 25 million you must have 50 million worth of new jobs. These requirements were also spread out over years so you couldn’t artificially inflate your work force or sell off equipment.
Not saying Intel doesn’t suck, but I doubt they are getting chips act money now. Or they will have to have a big turn around in the next few years to do so. They certainly aren’t getting a free 8 billion.
These layoffs will only be for a quarter or two. Just enough for the c-levels to unlock their full bonuses.
And create a glut in their labour market niche, which will take many years before the wages recover to what they were. In the current 20 year permanent labour shortage scenario, this is the way to prevent wages from increasing. Sure these demand shocks will create issues by they’re making the bet the lower overall expenses for wages will make it all worth it. This is them leveraging the imbalance of power been employer and employee
If only there were some tried and tested method for the working class to join together and create a power block equal to the company in order to negotiate better pay and conditions and avoid these outrageous tactics. Pity
Exactly! And then the Government can declare you an essential service and take away all your bargaining power!
Oh wait…
More like oh no, here I go molotoving again.
I hope it will never hit that point where its the only way forward.
Two generations of bad cpu’s and their solution is get rid of the workers so they can keep their bonuses.
Gotta keep that angle at 45° forever and ever.
Part of the lackluster CPU problem is that Intel was pissing away their money on other adventures. CPUs were “in the bag”, so they kept spending money on other stuff to try to “create new markets”. Any casual observer knew their fundamental problem was simple: they got screwed on fabrication tech. Then they got screwed again as a lot of heavy lifting went to the ‘GPU’ half of the world and they were the only ones with zero high performance GPU product/credibility. But they instead went very different directions with their investments…
For example they did a lot to try to make Optane DIMMs happen, up to and including funding a bunch of evangelism to tell people they’ll need to rewrite their software to use entirely new methods of accessing data to make Optane DIMMs actually do any better than NAND+RAM. They had a problem where if it were treated like a disk, it was a little faster, but not really, and if it were used like RAM it was WAY slower, so they had this vision of a whole new third set of data access APIs… The instant they realized they needed the entire software industry to fundamentally change data access from how they’ve been doing it for decades for a product to work should have been the signal to kill it off, but they persisted.
See also adventures in weird PCIe interconnects no one asked for (notably they liked to show a single NVME drive being moved between servers, which costed way more than just giving each server another NVME and moving data over a traditional fabric). Embedding FPGA into CPUs when they didn’t have the thermal budget to do so and no advantages over a discrete FPGA. Just a whole bunch of random ass hardware and software projects with no connection to business results, regardless of how good or bad they were. Intel is bad for “build it, and they will come”.
Two words, bean counters.
I wish them brain drain for being such greedy. Let their best people leave to better pastures.
MBA brain rot
What the actual fuck
While Intel has absolutely been losing money on its chipmaking Foundry business as it invests in new factories and extreme ultraviolet (EUV) lithography, to the tune of $7 billion in operating losses in 2023 and another $2.8 billion this quarter, the company’s products themselves aren’t unprofitable.
So what I’m getting here is that the CEO and or the board decided to invest in something that is losing a ton of money and so now 15% or more of the people who have been working diligently to actually make the company money are going to pay for it by losing their job.
So what I’m getting here is that the CEO and or the board decided to invest in something that is losing a ton of money
Intel has an enormous technical debt that they’re finally struggling to pay back after they hit a brick wall with their 7nm Titanium chipset.
It isn’t that this is wasteful spending so much as it is big upfront costs for future productive development.
That said, the fact that this work has to be government subsidized in order to be done raises the question of why this business is private at all.
I’m not sure I want the gov and huge amounts of my tax dollars going to operate federal gov chip fab plants. On the other hand I get your point that it is so heavily subsidized it is practically a de facto situation anyway.
I’m not sure I want the gov and huge amounts of my tax dollars going to operate federal gov chip fab plants.
That is ultimately what the subsidies amount to.
On the other hand I get your point that it is so heavily subsidized it is practically a de facto situation anyway.
I think the question isn’t “Do I want my tax dollars going to X?” (because they’re going there whether you want it to or not - semiconductors are an essential industry in a modern post-industrial nation). The question is how you want the business to operate. As a for-profit venture focused on returning the maximum profit to shareholders over the smallest time frame? Or as a public utility, focused on generating a sufficient quota of useful products for a fixed unit cost?
Part of the problem with the Western/Americanized economic system is that the second kind of enterprise is increasingly difficult to find. And where it does exist (the USPS, the state university system, the federal reserve, the SEC/FAA/EPA) there’s been so much privatization and regulatory capture that these institutions appear incapable of fulfilling their mandates.
But constantly diverting responsibility for fixing the problem by saying “I don’t want my tax dollars involved in this failed thing” doesn’t get us any closer to a solution. At some point, the public (and by extension the state bureaucracy) has to engage with our corrupt and failing economic cornerstones. Otherwise, we just become beholden to the nations we import from.
“Let Saudi-ARAMCO handle it” isn’t a solution I find particularly appetizing, either.
Doesn’t the US have semiconductor chip sanctions in place on China, specifically because it’s a national security concern? If semiconductors are that big of a deal that we need to sanction China over them… maybe they should be nationalized.
Doesn’t the US have semiconductor chip sanctions in place on China
Taiwanese Semiconductor is the global industry leader, and half of their output is sold to China. Korea and Japan are also major exporters. The Chinese manufacturers don’t care about losing access to Intel chips, when they’re a generation behind the curve anyway.
maybe they should be nationalized.
Wall Street would flip its lid if the US tried to nationalize Intel.
That’s definitely a huge issue but they’re going to have a hell of a time on the overcooked processors on the market right now. They’ve sold a hell of a lot of defective product over the past couple of years. Consumers and third parties are going to come after them for refunds. Consumer confidence is way down. They’re going to have a hell of a time trying to sell 15th gen to people. Everyone I know who knows what in the hell is going on is going to AMD.
Consumer confidence is way down. They’re going to have a hell of a time trying to sell 15th gen to people. Everyone I know who knows what in the hell is going on is going to AMD.
I’ve been in the industry since back when AMD actually was making the processors for Intel. And people have been saying this exact thing every time there’s a fluctuation in the processor market. Yet Intel still basically owns the market anyway.
The failure in Intel isn’t their processors, it’s their management.
I mean you can’t blame the rocks, of course it’s the management :)
You have a hell of a love for that phrase!
That’s exactly what happened, and that’s how layoffs always work.
The losses of the horrible decisions of the board/owners/management/etc are paid for by the blood of the workers. It’s so wonderful and very fair.
I think it’s even more absurd than that. The CEO/board decided to make a long-term investment which wasn’t going to pay off for several years. To what should be the surprise of no one, that meant short term losses.
Framing an investment in a massive amount of new infrastructure as a loss because it didn’t immediately start operating in the black is beyond unreasonable, but that’s the demand when all that matters is quarterly gains and year-over-year growth.
stop ‘non-essential’ work
So those jobs they’re cutting start with everyone with “Chief” in their title, right?
Of course not. The Chiefs earn every penny by making the difficult decisions to keep stock prices up. /s
I feel like they have the farm bet on Falcon Shores and (to a lesser extend) the Xe line now, and of course the foundry.
It’d be great if the bad rumors and delays would stop… yeah…
Wow, intel must really be struggling if they need to lay off this many people. I don’t think it’s reasonable to invest in Intel at this time.
Or well, I think news of layoffs should always be interpreted in a way that’s pessimistic for shareholders.
Have you seen the performance and efficiency of these arm chip? The performance and battery life of Apple’s chips compared to the Intel chips before then? Intel should be absolutely embarrassed.
I must admit I don’t keep up with chip developments.
Several tech companies have really stopped giving a shit lately. Intuit laid off a ton of people and referred to them as “not meeting expectations”, and Intel’s laid-off folks are now all apparently working on non-essential stuff.
Imagine losing your job and being told second-hand after you’d been shown the door that you were shit.
Fuck these companies.
Stagnation, baby.
I do a moderate amount of work with Intel, and I’d say the problem is not that the people are “shit”, it’s that their bureaucracy is so messed up. You have the people that actually engaged with their customers (support and sales), who marketing largely ignores, and marketing makes up stuff that isn’t in sync with the field guys, but that’s hardly a problem because the development executives then go off on their own “cool” ideas, without any buy in or anything from support, sales, or marketing. This has real impact, but then you have some middle managers spooling up side projects with like a dozen dedicated people each, adding another indirection of effort totally disconnected from any business capability.
So end result is you have an admittedly qualified team toiling away on a project that there’s just no way a potential customer will even hear about, working on problems that someone “imagined” that a customer never had, or is trivially solved in the industry already, but they don’t have the experience to know that. Even when the work is good and people might want it, it’s still doomed to obscurity because there’s such a disconnect between the engineers and any actual communication with potential customers.
Yes, I agree, and I think it’s a reflection of society’s values over the past 50 years.
We are living in a world with more of a “make money and fuck all else” mindset. Children of wealthy elites are living very privileged childhoods, and as a result, have less empathy and more contempt for real people. We are now seeing the effects of living in a society where the needle of social values is pointed 100% on the side of capitalism and 0% on the side of moral values. And how that has affected our perspectives of a society at large: a general lack of caring, a lack of empathy, a lack of conscientiousness from the top, tossing normal, real people aside like rubbish in a bin.
We’re seeing what happens when you let a generation of incredibly entitled children grow up to take the reins of society. We all know how it ends…
(And for what it’s worth, I think a long, extended Great Depression-style event is much more likely than a violent conflict, especially given how docile citizens of the west have proven themselves to be over the past several decades.)
