Intel Suffers Worst Stock Decline In Decades

Intel Corp. shares experienced their largest decline in more than 40 years after the company issued a grim growth forecast and announced plans to cut 15,000 jobs, signaling that the chipmaker is struggling to compete in the artificial intelligence (AI) era, Ian King reported for Bloomberg News.

Intel stated that it plans to cut more than 15% of its workforce. I Photo: Thomas Cloer Flickr

The shares fell 26% to $21.48, wiping out about $32 billion in market value. This marks the stock’s biggest single-day drop since at least 1982, according to data compiled by Bloomberg.

Sales for the current quarter are expected to be between $12.5 billion and $13.5 billion, the company said. Analysts had projected $14.38 billion on average, according to Bloomberg.

Intel also announced a projected loss of 3 cents per share, excluding certain items, versus expectations for a profit of 30 cents, Subrat Patnaik also reported for Bloomberg News.

Intel stated that it plans to cut more than 15% of its workforce, which currently totals around 110,000 employees.

The company is also suspending dividend payments to shareholders starting in the fourth quarter, with plans to continue the suspension until “cash flows improve to sustainably higher levels,” according to a company statement. Intel has paid a dividend since 1992.

“I have no illusions that the path in front of us will be easy,” Chief Executive Officer Pat Gelsinger said in a memo to employees. “You shouldn’t either.” He described the moves as “some of the most consequential changes in our company’s history.”