Intel is readying its third round of layoffs in the past 18 months, according to a report in the online journal TechCrunch. The trigger is reportedly poor performance in Intel’s nascent wearables business.
TechCrunch cites “sources close to Intel” saying Intel plans to lay off a significant number of the people working in its wearables group, a portion of the company that had been developing smartwatches, earbuds, and electronics to be embedded in clothing, among other new technologies.
Intel did not respond to a request for comment.
The wearable business is relatively small and so the pending layoffs wouldn’t be nearly as substantial as a round of cutbacks Intel announced in April, when the chipmaker said it planned to eliminate 12,000 jobs across the company. It also laid off more than 1,100 employees last year, citing poor sales.
Intel’s entire new devices group had just 579 employees in the United States following those layoffs, according to data obtained by The Oregonian/OregonLive last spring. The information, which Intel provided to laid off workers, showed the scope of the job cuts and the tally of remaining workers by business segment.
Still, setbacks in any of Intel’s new technology groups illustrate the difficulties of a mature tech company trying to find its way in the rapidly changing industry.
As Intel seeks to expand its business beyond the fading PC market, the company had touted wearables as key opportunity. Intel introduced a “smart bracelet” in 2014, for example, and acquired mobile fitness tracking company Basis.
The smart bracelet never took off, though, and last summer Intel recalled the Basis Peak line of smartwatches, warning some of them could overheat to the point where they could injure people. Intel stopped selling the devices altogether.
More recently, Intel has touted drone technology, virtual reality and autonomous driving as more promising business segments. It held an event last week to show off work the company has done in artificial intelligence.
Intel is Oregon’s largest private employer. It had 19,500 workers in Washington County before the job cuts began in April. Worldwide, the company now employs 105,600.
— Mike Rogoway