How Intel Instantly Slashed Costs By $4.2 Billion
Chip giant Intel (NASDAQ: INTC) is struggling as demand for PC and server chips tumbles. The company saw total revenue crash 32% year over year in the fourth quarter of 2022, and it expects a worse decline in the first quarter of 2023. Intel sees revenue coming in between $10.5 billion and $11.5 billion in the first quarter, down from $18.4 billion in the prior-year period.
Intel has already announced a broad cost-cutting initiative to help the company cope with lower demand this year. The plan is to knock down costs by $3 billion in 2023, with that total rising to $8 billion to $10 billion by the end of 2025. Layoffs will likely be part of the equation as Intel looks to weather one of the worst demand environments in its history.
In addition to that plan to slash annual costs by as much as $10 billion over the next few years, Intel disclosed a seemingly minor accounting change that will significantly impact its bottom line. Effective Jan. 23, Intel has increased the estimated useful life of some production machinery and equipment from five years to eight years.
Source Fool.com
