Intel has made broad cuts to employee and executive pay, a week after the company issued a lower-than-expected sales forecast driven by a loss of market share to rivals and a PC market downturn.
The reductions will range from 5% of base pay for mid-level employees to as much as 25% for CEO Pat Gelsinger, while the company’s hourly workforce’s pay will not be cut, said a person familiar with the matter who was not authorised to speak publicly.
Intel spokesman Addy Burr said in a statement that the “changes are designed to impact our executive population more significantly and will help support the investments and overall workforce”.
Intel last week said its profit margins were plunging as the PC market cools after several years of growth during the pandemic.
Gelsinger also conceded that Intel has “stumbled” and lost market share to rivals such as AMD, which on Tuesday reported quarterly sales that were above Wall Street’s expectations.
The person familiar with Intel’s pay cuts said that in addition to 5% decreases for mid-level employees, vice president-level employees will see 10% reductions and the company’s top executives other than the CEO will get 15% cuts.
The company has also suspended merit raises and quarterly performance bonuses, the person said.
Annual performance bonuses based on Intel’s overall financial performance will remain, but those bonuses have been smaller in recent years as the company has lost ground to rivals, the person added. — (c) 2023 Reuters