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Intel Plans Huge Job Cuts

Intel Reports Quarterly EarningsIntel Reports Quarterly Earnings

(Reuters) – Intel said it would cut 12,000 jobs globally, or 11% of its workforce, as the company moves away from its traditional business of selling chips used in personal computers.

The company also said on Tuesday Chief Financial Officer Stacy Smith will move to a new role leading sales, manufacturing and operations. Intel said it would begin a formal search process for a successor.

The world’s largest chipmaker also lowered its revenue forecast for the year. It now expects revenue to rise in mid-single digits, down from its previous forecast of mid- to high-single digits.

Intel’s shares (INTC) were down 2.6% at $30.78 in extended trading.

The Santa Clara, California-based company has been focusing on its higher-margin data center business as it looks to reduce its dependence on the slowing PC market.

Global personal computer shipments fell 11.5% in the first quarter, IDC said on Monday. The research firm anticipates a relatively weak environment in the first half of 2016.

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Intel said on Tuesday it would record a pretax restructuring charge of $1.2 billion in the second quarter.

On a per share basis, the company earned 42 cents per share, in the first quarter, up from 41 cents a year earlier.

Net revenue rose to $13.70 billion from $12.78 billion.

Non-GAAP net revenue came in at $13.80 billion, compared with analysts’ average estimate of $13.83 billion, according to Thomson Reuters I/B/E/S.

Up to Tuesday’s close, Intel’s shares had fallen 8.4% this year, compared with a slight gain in the broader semiconductor index.