Recently, Intel CEO Pat Gelsinger announced hefty cuts. Spending is to be cut by $10 billion by 2025, while 15,000 jobs will be eliminated. The company also withdrew from Arm, in which it owned $146.7 million in shares.
That’s according to an official filing on Tuesday, Reuters reports. The outlet rightly points out the poor state of Intel’s stocks. This year, the company has already seen 59 percent of its market value disappear. It may put Intel in the crosshairs of activist shareholders looking to put things in order.
Tip: Intel scraps Innovation event and announces new processors elsewhere
Arm shares
Arm, for its own part, is a hot potato when it comes to its (partial) ownership. It counts as a kind of “chip Switzerland” in the sense that everyone collaborates with the company and adopts the Arm architecture (or at least partly), but in recent years this concept has been challenged. Nvidia tried to take over the British company, but regulators balked, fearing that competition may be stifled by the move. Nvidia still is a shareholder, albeit with a frugal number of shares.
The reaction to the earlier Intel decision seems to have the market neither in despair or in jubilation. After a historically bad day on Aug. 2, the biggest drop in value since 1974, the stock has remained fairly stable, albeit at its lowest point since 2013. Gambles the company has taken, such as the creation of Intel Foundry as a chipmaker for third parties and the early adoption of High-NA EUV from ASML, will only pay off in the long run – if indeed they do.