Intel to Lay Off 1,000 Managers

By John G. Spooner  |  Posted 07-13-2006
Intel is set to lay off about 1,000 managers worldwide in a bid to streamline its operations.

The company began informing those managers affected by the cuts on July 13.

The move comes as Intel, which has been under pressure from rival Advanced Micro Devices of late, has progressed through about two months of a broad-based internal review of its business that's designed to make it a more nimble player in the PC market.

The review will leave no stone unturned, Otellini has pledged.

"This is one of the first actions of the efficiency project that [Intel CEO] Paul [Otellini] talked about at the financial analyst meeting in April, " said Bill Kircos, a spokesperson for Intel, headquartered in Santa Clara, Calif. "That process continues. This is just one step."

The company aims for the cuts to flatten out its management structure and improve communications and decision-making capabilities, as well as save on costs, Kircos indicated.

But the current set of layoffs may not spell the end of job reductions. The chip maker could reduce its overall employee roster of about 100,000 by as many as 10,000 to 15,000 workers, according to a July 13 report published by analyst Doug Freedman, of American Technology Research, in San Francisco.

Click here to read more about Intel's internal review, announced in April 2006.

"We have learned that Intel may be calling a press conference later today [July 13] to announce the results of the company's 'top-to-bottom' review. We believe investors are looking for work force reductions in the range of 10,000 to 15,000, as the company streamlines research and development with a PC-centric focus," Freedman wrote in his report.

Kircos declined to comment on the report.

The review, announced on April 27 following a lackluster first-quarter financial performance by Intel, has already inspired several changes by the chip maker. For one, it has arrived at a deal to sell its XScale application processor line to Marvell Technology Group for $600 million. That agreement, announced on June 27, will involve the transfer of most of the 1,400 employees who work on the product to Marvell as well.

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