Intel’s Plan to Improve Stock Price–Fire People

By Douglas A. McIntyre Published Jul 31, 7:10AM EDT

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Intel’s Plan to Improve Stock Price–Fire People — © JasonDoiy / iStock Unreleased via Getty Images

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Intel Corp. (NASDAQ: INTC | INTC Price Prediction) plans to fire thousands of people to improve margins.
The company has missed out on the biggest opportunities of the past decade.
Also: Discover the next Nvidia

Intel Corp. (NASDAQ: INTC) missed out on the massive revenue opportunity from artificial intelligence (AI) chips and products developed by Nvidia Corp. (NASDAQ: NVDA) and AMD. So far this year, Intel’s stock has been down 40%, and Nvidia’s stock is up 109% higher. Intel CEO Pat Gelsinger plans to fire thousands of people to improve margins because he does not have a way out of the hole he has put the company into.

According to Bloomberg, which broke the layoffs story, “Analysts project that Intel will report that second-quarter revenue was flat, compared with a year earlier.” Layoffs will not solve its problems. Cutting costs to drive up margins is rarely a winning strategy.

Last November, Gelsinger admitted to Intel’s significant failures. The hurdle is that they probably cannot be fixed.

The company was too slow to get into the massive phone chip industry. There has probably not been a larger chip opportunity in the past decade. The chance to get a large portion of that market is behind Intel. The company also missed out on the profitable graphics card business. And it also missed out on the chance to be an AI chip manufacturer.

There is some fiction that companies that miss the industry’s largest successes can return and conquer what they lost. For Intel, that is not an opportunity.

Forget Intel: This Stock Is the Next Millionaire Maker

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About the Author Douglas A. McIntyre →

Douglas A. McIntyre is the co-founder, chief executive officer and editor in chief of 24/7 Wall St. and 24/7 Tempo. He has held these jobs since 2006.

McIntyre has written thousands of articles for 24/7 Wall St. He is an expert on corporate finance, the automotive industry, media companies and international finance. He has edited articles on national demographics, sports, personal income and travel.

His work has been quoted or mentioned in The New York Times, The Wall Street Journal, Los Angeles Times, The Washington Post, NBC News, Time, The New Yorker, HuffPost USA Today, Business Insider, Yahoo, AOL, MarketWatch, The Atlantic, Bloomberg, New York Post, Chicago Tribune, Forbes, The Guardian and many other major publications. McIntyre has been a guest on CNBC, the BBC and television and radio stations across the country.

A magna cum laude graduate of Harvard College, McIntyre also was president of The Harvard Advocate. Founded in 1866, the Advocate is the oldest college publication in the United States.

TheStreet.com, Comps.com and Edgar Online are some of the public companies for which McIntyre served on the board of directors. He was a Vicinity Corporation board member when the company was sold to Microsoft in 2002. He served on the audit committees of some of these companies.

McIntyre has been the CEO of FutureSource, a provider of trading terminals and news to commodities and futures traders. He was president of Switchboard, the online phone directory company. He served as chairman and CEO of On2 Technologies, the video compression company that provided video compression software for Adobe’s Flash. Google bought On2 in 2009.