The dark day that chip stock Intel (INTC) employees have dreaded has arrived, and over 2,000 layoffs have already begun. Despite a good chunk of Intel’s top talent being shown the door, Intel shareholders are feeling pretty good about the whole affair. In fact, shares are up modestly in Thursday afternoon’s trading.
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The layoffs, according to a Times of India report, have hit “multiple U.S. states,” including Arizona, California, Oregon, and Texas. This round of layoffs featured over 2,000 job cuts as part of a broader strategy to pare back 15,000 jobs in total. This is likely part of the same round of layoffs that got pushed back a couple weeks in Israel, as we found out earlier this week.
While the cuts are significant everywhere, the Times of India report noted that Oregon was perhaps the hardest hit. Intel is the second-largest private employer in the entire state, so losing any of its 20,000 workers there is a disproportionate hit to the state’s overall operations. Worse yet, more job cuts are likely to come as Intel continues to work to pare down its spending by any means available.
Amazon and Intel Get Together
Intel is also making some new moves, though not Intel specifically. Rather, an Intel spin-off, Articul8 AI, recently set up a deal with Amazon Web Services, Amazon’s (AMZN) cloud services arm. The two now have a “strategic collaboration agreement” together, noted a report in the Silicon Valley Business Journal.
The new partnership, according to AWS director of technology partnerships Alan Braun, will allow Articul8 to “…expand their ability to provide solutions that enable customers to build and deploy enterprise-grade generative AI applications on AWS and help customers achieve meaningful business outcomes at scale.”
Is Intel a Buy, Hold, or Sell?
Turning to Wall Street, analysts have a Hold consensus rating on INTC stock based on one Buy, 26 Holds, and seven Sells assigned in the past three months, as indicated by the graphic below. After a 35.55% loss in its share price over the past year, the average INTC price target of $25.38 per share implies 12.57% upside potential.
