Intel Reports Second Quarter 2024 Financial Results

[softfalcon]

This sounds worryingly like “sales are down, cut costs to maintain profitability to spike our stock numbers” and not enough focus on what I believe is actually wrong, which is that they can’t seem to reliably make competitive processors in a stiff market.

Anyone else feel like this is bean counters at Intel playing the wrong game? I personally feel like leadership at Intel lost the plot almost a decade ago.

[NoPicklez]

We have very little understanding of the bloat that Intel might be carrying, or the projects they have underway that were not making progress or perhaps not the innovation expected.

Financial reports are going to be exactly that, focused on the numbers and appearing to investors to be maximising their value. You want to carry a perception that you are focusing on the positives and the innovations being carries forward, as opposed to mulling over what "might be wrong". All companies go through ups and downs, but you do not want your financial report to have a theme of these are the things that are wrong.

[layer8]

Leadership changed back to an engineer with the return of Pat Gelsinger in 2021. I’d give him a couple more years. It takes time to turn around a big ship like Intel.

[bluedino]

10 years from now, when the downfall of Intel is being taught at business schools, what are going to be the big takeways and now-obvious mistakes?

[crowcroft]

I'm not saying you're wrong, although even after reducing headcount by 15k they still have about as many employees as TSMC, NVIDIA and AMD combined.

[Detrytus]

I believe the ambitious plan by Gelsinger to release "5 nodes in 4 years", as well as building couple of new factories necessarily resulted in a lot of redundancy and hiring people who were needed for the transition period, but not necessarily long term. Now that they are nearing the completion of Intel 20A and 18A R&D cycle it seems logical point to start cost-cutting.

[electriclove]

Bean counters were not the cause of this titanic fail. And at this point, they need to shed their excess weight and find a way to stay relevant.

[llmblockchain]

I live near Intel HQ and I know many Intel employees. Everyone I know has been interviewing at other companies for the last 8-12 months. I haven't met a single person that had a positive thing to say about Intel and its future.

[DaoVeles]

They should have never sold the Xscale division.

[hylaride]

Suspending the dividend is poetic in a sense. They'd been taken over by bean counters decades ago and slowly pissed away their privileged position at the top of computing.

They essentially ended up where Boeing did, but at least didn't kill anybody.

[DaoVeles]

A lesson that has to be taught again and again. You can run a business into the ground but look great for years on inertia alone. Intel has been crumbling for a long while but the inertia of previous decades meant it wasn't apparent.

[Vecr]

Maybe. On Intel's scale almost everything you do wrong kills people, at least statistically. Though, so does everything you do right, but probably less. How many human lifetimes were spent cleaning up and mitigating the microarchitecture vulnerabilities?

[dredmorbius]

Additional coverage from:

The Register: "Intel to dump 15 percent of staff to save costs" <https://www.theregister.com/2024/08/01/intel_to_ax_headcount...>

CNBC: "Intel to cut 15% of headcount, reports quarterly guidance miss" <https://www.cnbc.com/2024/08/01/intel-intc-q2-earnings-repor...>

[StringyBob]

Intel had over 130,000 employees as of a couple of months ago.

15% layoffs is nearly 20,000 people.

[electriclove]

The ‘flagged dead’ comment is right on. Intel has been a bloated bureaucracy for a long time now and things need to get tightened up for it to continue.

[IamLoading]

I am surprised, the stock didnt improve. Typically, markets like layoffs.

[honkycat]

$152 billion in stock buybacks. We don't have an economy anymore, we are just handing money to the ultra-wealthy.

US. Total economic collapse. Hard landing.

This is the beginning of the end. We really had the chance to make something beautiful with this country, but the 1% bought and sold it into the ground.

Half our politicians aren't even trying to keep it running anymore.

[wwtrv]

Stock buybacks are basically just more flexible dividends. Companies used to payout way more in dividends in the past now they do buybacks instead.

[s1artibartfast]

They should have done more buybacks so it could be used for something productive. All of the money left in the company is going to be wasted as it rots from the inside.

The company didn't die of starvation, it died of obesity.

[ProllyInfamous]

Heck, our politicians are at the point where they're taking their bribes in pure gold (see NJ's recent senatorial shame).

A good friend of mine is the son of a former hedgefund manager... who told me in 2018 "owning real gold is foolish;" in 2024, he's recently told me about his expanding gold collection.

I have made even more returns on silver/BTC, but anything "real" is probably durable enough to last for (hopefully at least) another decade of keep kicking the can down the road...

Quoting my favorite family member of The Silent Generation (pre WW2 birth), "Nobody wants to be the last one at the party, because then you have to help clean up all the mess!"

[shlant]

I hate that I can't tell if this is satire

[jaredklewis]

Why would anyone buy stocks if companies didn't do buybacks or issue dividends? The whole purpose of stocks is to be financially rewarded for investing capital.

Like if you just don't like stock markets or capitalism in general, that's fine, but that doesn't have anything to do with stock buybacks.

[myth_drannon]

Intel stock is down -24% in pre-market trading. That's going to be a "fun" Friday for sure.

[bluedino]

Reducing Operating Expenses: The company will streamline its operations and meaningfully cut spending and headcount, reducing non-GAAP R&D and marketing, general and administrative (MG&A) to approximately $20 billion in 2024 and approximately $17.5 billion in 2025, with further reductions expected in 2026. Intel expects to reduce headcount by greater than 15% with the majority completed by the end of 2024.

[fire-them-all]

INTC should fire the right people!

[fire-them-all]

INTC and its subsidiaries should consider a comprehensive reorganization. The company is struggling, and it seems they're making poor decisions regarding staffing and leadership. Mediocre and ineffective leadership persists at all levels, and the business and sales departments are likely contributing to the issues as much as HR.

If you want to help turn things around, contact the board members and CEOs directly. Make it clear that they should not receive any compensation until they have successfully revitalized INTC, MBLY, and other related companies. For reference, these are the KPIs for them: INTC's market cap should be currently around $250 billion and MBLY's is about $35 billion.

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Jensen Huang, please buy INTC!!!! PLEASE BUY IT AND MAKE IT GREAT AGAIN! PLEASE PLEASE PLEASE!

[LarsDu88]

Nvidia could probably buy a fab off of Intel. As a famous chip exec once said "Real men build fabs"

However, the secret sauce of Nvidia is simply using TSMC anyways so...