Intel Corp reported a $1.6 billion net loss for the April to June quarter results of calendar year 2024. The chipmaker's shares fell more than 26 per cent, its largest intraday fall in 40 years as the company plans to cut 15,000 jobs.
Anubhav Mukherjee
Published2 Aug 2024, 09:02 PM IST
Intel Corp announced their Q2 CY2024 results on Thursday, August 1. (Reuters)
Intel Corp., the American chipmaking company reported a $1.6 billion net loss for the April to June quarter results of calendar year 2024. The company made a net profit of $1.47 billion in the same quarter the previous calendar year, as per the company's second-quarter results.
Intel's shares fell more than 26 per cent, the largest fall (intraday) in more than 40 years as the company's second-quarter results forecast gloomy growth. The company also plans to cut 15,000 jobs, according to a Bloomberg report on Friday, August 2.
Also Read | Intel to lay off 17,500 employees, suspend dividend; stock plunges
“Our Q2 financial performance was disappointing, even as we hit key product and process technology milestones. Second-half trends are more challenging than we previously expected, and we are leveraging our new operating model to take decisive actions that will improve operating and capital efficiencies while accelerating our IDM 2.0 transformation,” said Pat Gelsinger, Chief Executive Officer of Intel in the earnings release.
The company forecasted that the third quarter sales for the company will range between $12.5 billion to $13.5 billion, said Intel in the earnings release. Analysts estimated revenues to reach $14.38 billion on average, as per data from the Bloomberg report.
Also Read | Intel to cut 15% jobs, suspend dividend in turnaround push
Intel also announced that the company is suspending the dividend payouts from the fourth quarter of calendar year 2024. “The company reiterates its long-term commitment to a competitive dividend as cash flows improve to sustainably higher levels,” said the company in the release.
The chipmaker also announced a 15 per cent reduction in their company headcount to reduce the expenses of the company.
“I have no illusions that the path in front of us will be easy,” said Pat Gelsinger CEO in a memo to employees, reported Bloomberg. “You shouldn’t either," he said.
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Also Read | Intel to cut thousands of jobs to cut costs, bounce from flat earnings: Report
Intel is reducing 20 per cent of expenses on new plants and equipment in 2024, and now is budgeting between $25 billion and $27 billion. Next year the expenses will be between $20 billion and $23 billion, as per the report.
“By implementing our spending reductions, we are taking proactive steps to improve our profits and strengthen our balance sheet. We expect these actions to meaningfully improve liquidity and reduce our debt balance while enabling us to make the right investments to drive long-term value for shareholders," said David Zinsner, Chief Financial Officer (CFO) at Intel.