Intel to slash capex as chipmaker contends with Trump trade war
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Intel plans to slash its capital expenditures and streamline its business as the US chipmaker plots a turnaround under its new chief executive and contends with President Donald Trump’s trade war with China.
The company, which cut 15,000 jobs in the second half 2024, said on Thursday its plan included “streamlining the organisation, eliminating management layers and enabling faster decision-making”.
But Intel gave a more downbeat guide on the current quarter — sending its shares lower in after-hours trading — as the Trump administration’s sweeping tariff plans send shockwaves through the semiconductor industry.
The California-based chipmaker and designer said it expected adjusted revenue of $11.2bn to $12.4bn for the three months to the end of June, lower than analyst expectations of $12.9bn, according to Bloomberg estimates.
The shares were down more than 6 per cent in after-hours trading following the release.
Intel’s earnings report was the first since Lip-Bu Tan took over as chief executive in March, after the board ousted Pat Gelsinger in December.
Tan said in a statement that he was taking “swift actions to drive better execution and operational efficiency while empowering our engineers to create great products”.
Intel said it was not including restructuring charges in its guidance.
For the first three months of 2025, Intel reported adjusted revenue of $12.7bn, flat from a year ago but above Wall Street’s consensus estimates of $12.3bn. Its net loss widened to $821mn from a loss of $381mn a year ago but was better than analysts expected.
Trump has spared semiconductors and related products from the brunt of his tariff regime on China. But they are subject to a national security review that could lead to further tariffs and more disruption to the highly complex, global semiconductor supply chain.
Washington has already cracked down on exports of artificial intelligence chips to China by US companies including Nvidia and Intel, as it seeks to exert pressure on Beijing and protect American technology.
