Intel’s stock dropped around 30% overnight, shaving some $39 billion from the company’s market capitalization since rumors of a pending layoff first emerged. The devastating results come after the chip giant reported a loss for the second quarter, complained about yield issues with the Meteor Lake CPU, provided a modest business outlook for the next few quarters, and announced plans to lay off 15,000 people worldwide.
When the NYSE closed on July 31, Intel’s market capitalization was $130.86 billion. Then, a report about Intel’s massive layoffs was published, and the company’s market capitalization dropped sharply to $123.96 billion on August 1. Following Intel’s financial report yesterday, the company’s capitalization dropped to $91.86 billion. Essentially, Intel has lost half of its capitalization since January. As of now, Intel’s market value is a fraction of Nvidia’s worth and less than half of AMD’s.
As Intel’s actions look rather desperate, analysts believe that Intel’s challenges are existential. “Intel’s issues are now approaching the existential,” Stacy Rasgon, an analyst with Bernstein, told Reuters.
Fucking good! I know it’s not the primary reason, but it’s by high time that people see laying off 15k people as a bad thing and the company suffering for it.
I fear it’s wishful thinking that the layoffs are what made the stock tank. It’s certainly never hurt anyone else…
The layoffs were announced at the same time as Intel’s Q2 financial results: https://www.intel.com/content/www/us/en/newsroom/news/actions-accelerate-our-progress.html
Yep, that’ll do it.
They’re not even bothered by the fucked up chips.
I was gonna say… how is it not this? Weird world.
I’m guessing those chips are a tiny fraction of Intel’s revenue.
AMD have been eating their lunch on more than just gaming PCs.
Stock price is largely about future earnings potential, not current quarter or past results. That’s why a company can have record-breaking earnings, but still eat shit in stock price for a while if it lowers predictions for next quarter.
yet
Oof, now agile bullshit talk is infecting the lingo of the c-suite and being used as justification to do layoffs. I should’ve seen that coming, though I must’ve skipped the portion of the agile manifesto that said to choose Lamborghinis over employees.
I think it made an already bad situation worse.
I think the AI thing has really caught them off guard. There’s a gold rush and they have no real shovels to sell.
Intel’s only hope now is for the Chinese army to go for a holiday in Taiwan. Their competitors are hugely reliant on TSMC. That’s been brewing forever though, and hopefully will continue to not come to anything. The last thing the world needs right now is more fucking war…
Yeah, it’s usually the opposite: Layoffs by themselves usually make the stock go up, as the company is reducing their expenses.
The issue with Intel is that they announced layoffs combined with a bad earnings call, so it’s a sign the company isn’t going so well.