Ask Lemmy

Maybe i’m naive about the way businesses work; but if your still profitable, and you know you need to “catch up” why lay off people and close sites?

Precisely because you're queuing the company up for M&A. You're going to let the next guy do the investing and remodeling. In the meantime, Intel needs to look like a blank slate - paid down debts, no long term project costs, lots of potential for leveraged buyouts - so private equity can come in and do their thing.

Whether that means a Berkshire style business rewrite or a Bain Capital gutting and scrapping for parts, the important thing is that the investors get to project their vision of the future onto you. They're not burdened by whatever plans the prior managers had on the table.

However for a company where RND is really where the value is, like Intel, it just doesn’t seem to make sense

When you're on the bleeding edge, R&D is a value-add because it keeps the like-minded customers shopping from you. But when you're lagging by a decade or more, it may be more efficient to simply strip mine your assets and narrow the focus of the business to the most profitable sectors. Intel could easily go the way of Nokia, making low cost substitutions for manufacturers who don't want or need the high end chipsets. At the 7nm mark, Intel can just... keep making chips forever with comparatively little overhead. They don't ever need to do better, because dishwashers and coffee machines don't need the same kind of hardware as AI data farms or high end graphics cards.