A major US technology company is on the brink after its CEO was forced out following a mass layoff of 15 percent of his company’s workforce.
Former Intel CEO Pat Gelsinger resigned after less than four years in the role, having assumed it in February 2021.
During his tenure, Intel shares fell 61 percent, culminating in a massive restructuring that began in August that aimed to cut $10 billion in costs and “fundamentally change the way we work,” Gelsinger said at the time.
He will be replaced on an interim basis by David Zinsner, Intel’s chief financial officer, and Michelle Johnston Holthaus, general manager of Intel’s Client Computing Group, while the company searches for a new leader.
The interim CEOs will now have to catch up with other chip manufacturers, such as Taiwan’s TSMC.
Once the world’s largest computer chip maker, it missed its target in 2022 when it failed to invest in chips that could power AI data centers.
Instead, Nvidia, once a small competitor, is betting big on AI and is now worth $3.4 trillion – 33 times as much as Intel.
Despite taking a back seat, Intel does have the support of the federal government, which under Joe Biden is eager to aggressively grow the U.S. chip manufacturing sector in an effort to regain control from Asia.
Workers are seen in front of a ‘High NA EUV’ lithography system at an Intel factory in Hillsboro, Oregon, US in this handout image obtained by Reuters on April 19, 2024
Intel CEO Pat Gelsinger speaks at the Taipei Nangang Exhibition Center during Computex 2024, in Taipei on June 4, 2024
Last week, Intel announced that while an $8.5 billion grant awarded under the CHIPS Act would reduce the law’s $280 billion in semiconductor funding to $7.86 billion, this would are offset by a separate $3 billion subsidy from the government to produce chips for defense purposes.
Intel’s big shake-up in the C-suite comes after Meta cut a host of jobs from Instagram, WhatsApp and Reality Labs.
A spokesperson for Meta told Reuters in a statement that a number of its teams were making changes to align with their long-term strategic objectives and location strategy.
‘This includes moving some teams to different locations, and moving some employees into different roles. In situations like this where a role is eliminated, we work hard to find other options for affected employees,” the spokesperson said.
The Verge report did not specify the exact number of job losses, but said they were small. Meta also did not comment on the figures.
Meta has cut around 21,000 jobs since November 2022 to keep costs down, with CEO Mark Zuckerberg calling 2023 the ‘Year of Efficiency’.
Meta stock is up more than 60% this year and is currently at an all-time high after he canceled several low-priority projects in an effort to boost growth and allay investor fears that he was making way too much had spent money on the metaverse. , the failed attempt to build a virtual world for its VR headsets.
In its latest second-quarter results, Meta exceeded market expectations for revenue and issued a rosy sales forecast for the third quarter, indicating that robust digital ad spend on its social media platforms can cover the cost of its artificial intelligence investments .