Intel’s massive job cuts come after it received $8.5 billion in taxpayer money

Rusty Snippets

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Months after the federal government gave Intel $8.5 billion in grants to help bring back chipmaking to the U.S., the company said it is cutting 15% of its workforce, which translates to around 17,000 jobs.

The tech company announced the job cuts as part of a massive cost-cutting and restructuring plan.

"This is an incredibly hard day for Intel as we are making some of the most consequential changes in our company’s history," Intel CEO Pat Gelsinger said in a note to employees this week. "Simply put, we must align our cost structure with our new operating model and fundamentally change the way we operate."

Gelsinger added that revenues hadn’t "grown as expected."

"Our costs are too high, our margins are too low," he wrote. "We need bolder actions to address both — particularly given our financial results and outlook for the second half of 2024, which is tougher than previously expected. These decisions have challenged me to my core, and this is the hardest thing I’ve done in my career. My pledge to you is that we will prioritize a culture of honesty, transparency and respect in the weeks and months to come."

The company's stock fell 26% Friday after the announcement.

The decision to cut jobs after the influx of federal funds has raised some eyebrows.

"Someone help me understand how this is smart or fair," "Making Money" host Charles Payne wrote on X Saturday. "The Biden-Harris administration has handed billions of dollars to the richest corporations ever, including many foreign companies."

 
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