Intel beats on revenue, slashes foundry investments as CEO says 'no more blank checks'

Intel reported second-quarter results on Thursday that beat Wall Street expectations on revenue, as new CEO Lip-Bu Tan announced significant cuts in chip factory construction

In a memo to employees, Tan said that the first few months of his tenure had "not been easy. "Intel s are up 13% so far this year as of Thursday's close after plummeting by 60% in 2024, their worst year on record

Justin Sullivan | Getty ImagesIntel reported second-quarter results on Thursday that beat Wall Street expectations on revenue, as the company's new CEO Lip-Bu Tan announced significant cuts in chip factory construction

Here's how the chipmaker did versus LSEG consensus estimates:Earnings per : Loss of 10 cents per, adjusted

Revenue: $12. 86 billion versus $11. 92 billion estimatedIntel said it expects revenue for the third-quarter of $13. 1 billion at the midpoint of its range, versus the average analyst estimate of $12. 65 billion

The chipmaker said that it expects to break even on earnings while analysts were looking for earnings of 4 cents per

Moreover, For the second quarter, Intel reported a net loss of $2

Earnings per were not comparable to analyst estimates due to an $800 million impairment charge, "related to excess tools with no identified re-use," the company said

That resulted in an EPS adjustment of 20 cents, considering recent developments

The report was Intel's second since Lip-Bu Tan took over as CEO in March, mising to make the chipmaker's ducts competitive again, and to reduce bureaucracy and layers of management, including slashing staff in Oregon and California

Moreover, In a memo to employees published on Thursday, Tan said that the first few months of his tenure had "not been easy. " He said that the company had " the majority" of its planned layoffs, amounting to 15% of the workforce, and that it plans to end the year with 75,000 employees

Intel previously said it was trying to reduce operating expenses by $17 billion in 2025

Tan also announced several other spending cuts in the memo, particularly in the company's costly foundry division, which makes chips for other companies and is still looking for a big customer to anchor the

Intel said its foundry had an operating loss of $3, in today's financial world. 17 billion on $4. 4 billion in revenue

Tan said that Intel had cancelled planned fab jects in Germany and Poland, and will consolidate its testing and assembly operations in Vietnam and Malaysia

He added that the company would slow down the pace of its construction of a cutting-edge chip factory in Ohio, depending on market demand and if it can secure big customers for the facility

On the other hand, "Over the past several years, the company invested too much, too soon – without adequate demand," Tan wrote

Additionally, "In the cess, our factory foot became needlessly fragmented and underutilized, in today's financial world. "Tan wrote that the company's forthcoming chip manufacturing cess, called 14A, will be built out based on confirmed customer commitments. "There are no more blank checks

Every investment must make economic sense," Tan wrote

Tan wrote in his memo that Intel wants to regain market in data center chips, and is looking for a permanent leader for the

Longtime rival Advanced Micro Devices has increasingly been winning server from cloud customers

Tan added he would personally review and apve all chip designs before they are taped out, which is the final step of the design cess before a new chip is manufactured

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