Well, well, well, how the turntables. Intel, the once mighty chip world leader, is now scrambling to save face by cutting 15% of its workforce. But let's be honest—this lipstick on a pig act isn’t fooling anyone. Today, short sellers are having a field day with Intel's plummeting stock.

How did we get here? Well, Pat Gelsinger, Intel’s CEO, took charge in 2021 with dreams of a grand turnaround. Fast forward three years, and Intel’s strategy seems about as effective as trying to fix a leaky boat with chewing gum. Once the ruler of the chip kingdom, Intel is now playing catch-up to TSMC and Samsung. Gelsinger’s big plan to turn Intel into a major chip producer for other companies looked good on paper. But after tens of billions of dollars spent, all Intel has to show are red numbers and a lot of worried investors shaking their cursors over the “sell” button.

Last year, Intel's chip manufacturing division pulled in $18.9 billion in sales but still ended up with a staggering $7 billion operating loss. And while Intel’s core businesses—PC and data center chips—used to be rock-solid, they're now taking hits left and right. Falling PC sales and Nvidia’s dominance in AI chips have left Intel licking their wounds. To top it off, Intel’s adjusted free cash flow was a jaw-dropping negative $11.9 billion last year. Yes, you read that right—negative billions.

(Source: BuzzFeed)

So, what’s Intel’s grand plan to get back on track? Well like we talked about yesterday, they’re slashing costs by $10 billion. This means cutting 15% of their workforce, suspending dividends, and tightening up on spending. But these moves feel more like frantic band-aids than a real cure. Investors aren’t buying it either. Intel’s shares, down 55% this year, took another beating, dropping 25% today. Remember when Intel was worth more than AMD and Nvidia combined? Now, Nvidia alone is worth almost 25 times more than Intel. Talk about a fall from grace.

Just when you thought it couldn’t get worse, the U.S. government yanked Intel’s license to supply chips to China’s Huawei. This move could slash Intel’s third-quarter revenue by 12% and cut its gross margin to 34.5%. The core issue? Intel can’t keep up with TSMC and Samsung in chip manufacturing or reclaim its edge from Nvidia in processor innovation.

Intel’s story is a harsh reminder of how fast the tech world changes. From a dotcom darling to struggling to keep pace, Intel’s journey highlights the brutal pace of innovation. Gelsinger insists that Intel will "survive to continue the fight," but it's a bit like DeSantis during the Republican debate when he promised he wouldn't let us down—you could almost see in his eyes that even he didn’t buy it.

(Source: MSN)

Intel plans to splash out $100 billion on factory expansions across four U.S. states, hoping to lure in other companies like a desperate high schooler trying to fill up their yearbook with signatures. But right now, this plan is just inflating costs and squeezing profit margins.

In the end, Intel’s tale is a powerful lesson that job cuts and cost-saving measures might offer a temporary fix, but it's kinda like buying a fixer-upper. You can paint the walls and put in new flooring, but if you don’t replace the leaky roof and moldy drywall, it’s pointless.

Stock.News has positions in Intel.