Intel cancels new plants, cuts staff by 20%. Weren’t tariffs supposed to CREATE jobs and factories?

Photo above - "Crazy-rich Asians". This is Lip-Bu Tan, who became the new CEO of Intel last month. He got $66 million in stock options as his welcome aboard gift . . .

Meet Lip Bu Tan. On the job about 3-4 weeks. His first executive order? Cut factory spending by $2 billion and slash 20% of the jobs. For real . . . this is not a satire. See the link at bottom.

Excuse me Mr. Lip . . . is that how US tariffs on foreign goods are supposed to work? We LOSE jobs in America, and cancel new factories?

Mr. Lip says his decision is due to poor Intel earnings. In 2024 Intel sales were down 1/3rd. Everybody who did NOT buy a new laptop last year, this is on you. (I bought an HP Pavilion with the bottom rung Intel I3 Core chip and a 15.6 inch screen. Beware – the battery life really disappoints). Or castigate yourself if you bought a laptop with an AMD processor, or some other off-brand CPU.

Analysts have been complaining that Intel isn’t a credible player in the AI magical universe, and that’s why their stock is tanking. Possibly true, but AI companies are like EV manufacturers: there a zillion of them at the start, but most won’t survive. Did anyone here buy a Canoo? Or a Fisker? Or a Nikola? Thanks for taking a leap of faith! Better still if you were an investor in any of these . . .

I don’t expect Intel to disappear entirely. It’s quite possible that Mr. Lip’s strategy of cutting expenses and new investments will pay off, and he can shrink Intel to profitability. Stop laughing, it’s possible. Or it's also possible that a smaller but still struggling Intel might be an attractive takeover target as the stock continues to tank. Does anyone need some last gen, temporarily closed chip factories? Intel may turn out to be a real estate play, like dying shopping malls.

Intel’s CEO is also requiring employees to show up at their actual desks 4 days a week. I don’t think this is intended to improve productivity. It’s probably an excuse to fire people, rather than get stuck with severance pay.

Fed Chairman Jerome ("I can't be fired") Powell has promising – forever – that high interest rates will stop inflation. Unfortunately, high rates also stop investment in new factories and equipment. In fact, that’s how you “cool off” an economy: cancellation of new construction, and termination of employees. Congrats, Chairman Powell for doing your part. And now Intel is doing its part as well . . .

I’m just sayin’ . . .

Intel To Cut Operating Expenses By $1.5 Billion Through Next Year