Can chip stock titan Intel (NASDAQ:INTC) ever catch a break? Its fortunes have been on a decline for quite a while, and now, it’s planning one of the most last-ditch of strategies to respond: layoffs. Normally, companies who engage in layoffs see a little bump in share prices, but not Intel; Intel is down fractionally even after the planned job cuts were announced.
Intel filed reports with California officials, and at the end of this month, Intel will be down another 140 jobs at sites throughout the state. This is part of a larger plan at Intel, reports note, that features the company working to reduce costs and gain efficiency. The cuts will focus on the Folsom location, where 89 employees will be dismissed, and another 51 will depart from San Jose. Though a look at the number of survivors might suggest why the cuts had so little effect on share prices: Intel has a combined total of over 13,000 employees.
The number is also lower than the 300 cuts that earlier reports projected from three different California offices. The cuts will come in artificial intelligence, cloud computing, and GPUs. These areas have recently demonstrated incredible growth potential—just look at Nvidia (NASDAQ:NVDA)—so why Intel would reduce its employee forces in those areas is somewhat unclear.
At any rate, the move isn’t helping things with analysts either. Currently, Intel stock is rated a Hold by analyst consensus, as expressed by five Buy ratings, six Sells, and 19 Holds. However, those buying in on Intel stock can get a 10.85% upside potential thanks to Intel’s average price target of $36.07.
