Boston, MA 01/23/2014 (wallstreetpr) – Intel Corporation (NASDAQ:INTC) has announced that it is carrying on with its planned reduction of staff count. The company targets to trim its workforce by 5 percent this year. At the same time, Intel will freeze hiring in locations such as India where it has its second largest non-manufacturing unit.
The staff cuts and freezing of hiring will help the company through consolidations, especially in its research and development operations. Consolidation enables the company to deploy resources in such areas like tablets, smartphone where profit margins are higher.
The announced staff reduction is expected to take the form of retirement and voluntary program. As of end of 2013, the company had about 108,000 employees with India having about 4,500.
Intel Corporation (NASDAQ:INTC) is the largest maker of chips for personal computers, graphics and servers. The company is however troubled by declining sales in the personal computer market. It is now making spirited efforts to vie for a strong position in the mobile and tablet chip market which although lucrative, its position is hurt by late entry.
Plant upgrades
The company, through consolidation and other means, is expecting to raise funds for the upgrade of its various manufacturing facilities, after which it would also start installing new plants. The company has its sight set on upgrading its 20nm plant in Israel where the government is willing to increase its grant to the company to facilitate the project. Similar upgrades are expected in the U.S. as the company seeks to boost ramping of 14nm chips which are suitable for tablets and smartphones.
Winning over chip customers
Last week reports emerged that Intel Corporation (NASDAQ:INTC) was willing to pay smartphone and tablet makers to use its chips in their new devices as part of effort to expand its market. Intel is kept at the peripheries of the lucrative high-end smartphone chips market by QUALCOMM, Inc. (NASDAQ:QCOM) which enjoys the top spot in the segment.
Besides paying customers to use its chips, Intel Corporation (NASDAQ:INTC) is also involved in talks with Samsung Electronics, HTC Corp, NEC, Fujitsu and other smart device makers for the development of a mobile operating system which will give its exclusive chip supply contracts.
