Intel hit by the crisis? by Claudia Sonea

The economic crisis is still far from being over. Although US officials showed an obvious confidence that the state economy is heading towards the end of the crisis, the actions taken by some companies are contradictory. For instance, the world’s biggest chipmaker, Intel Corp, is restructuring and it is not because the situation is great and the profits are boasting. In April, Intel’s fist-quarter profit showed a drop of 56 percent from the previous year. The Chief Executive at that time, Paul Otellini, pleaded that the industry hit rock bottom, thus it will follow a period of recuperation and improvement in the following ! season. If that was true, why are they reorganizing the two major divisions? A possible explanation would be that the reorganization has no economical reasons and unfortunately leads to the release of contracts of some people. By creating a single unit for both personal computers and mobile devices, the number of workers required decreased and the management also suffered as the successful executive Pat Gelsinger who was in charge of the department of supplied chips for PCs and servers left the company. However, Gelsinger left the company because he hunted a better job at the storage equipment maker EMC Corp as division president at Hopkinton, Massachusetts-based EMC. According to the official statement the changes are part of a strategic move that presents the fact there are architectural and technical similarities between chips used for different applications. Moreover, Intell’s decisions have nothing to do with Gelsinger’s departure or with the drop in their ! profit. Paul Otellini is CEO since 2005 and ! there is no sign that things will change soon, although the reorganization prepares a successor list with Executive Vice President Sean Maloney and Executive Vice President Dadi Perlmutter on top of it. Maloney is set to manage the combined product group's business and operations and Perlmutter will take care of the product development. Whether it is true or not that restructures are linked to the financial situation of Intel under the influence of the economic crisis, the importance resides in the fact that some people will lose their jobs, thus contributing to the alarming rate of the unemployment. Good luck to them in finding a job on the already saturated market.

related story (sgx15374): http://news.yahoo.com/s/nm/20090914/tc_nm/us_intel;_! ylt=AmDo...

by Claudia Sonea for PocketNews (http://pocketnews.tv)

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