Intel slashes quarterly dividend by 50 cents, stock declines
Speaking of tech, let's talk about Intel. Intel is slashing its quarterly dividend by 50 cents annually as the company looks to conserve cash amid economic headwinds. It's coming after the chipmaker warned of losses to come in the first quarter and pledged to reduce its cost by $3 billion this year. We also, the last time that our Brian Sassi talked to Pat Gelsinger, the CEO, he said he was committed to the dividend. But that said, it's not a huge surprise that we are seeing this move given some of the troubles that Intel has had. If you look at the quarterly basis now, the dividend is going to 12.5 cents per share.
It was something like 36.5 cents a share on a quarterly basis. Yeah, so slashing that by about two-thirds on the dividend basis there. They're also cutting compensation, reducing some other operating expenses the company talking about. And in a quote in this statement, the CFO, David Sissner of Intel, saying in the fourth quarter we also took some of the steps to right-size the organization, rationalize investments. This is on top of what they had already initiated in some of those cost-cutting measures, including the headcount reductions there. It's important to remember what their long-term targets here are on the cost reduction targets, $3 billion in 2023, and then achieving $8 billion to $10 billion by the end of 2025.
It also comes at a time where they're spending a lot of money that they've either partnered with the likes of Brookfield and there's going to be another partner that they've teased as well on bringing some of the capacity up to speed for fabrication processes and foundry services. And so with those dollars, combined with the government dollars that have been earmarked for bringing more chip capacity online, that is where more money is continuing to go out the door for Intel and where some of those costs are being restructured to prioritize with the future of the company and that next leg of growth could perhaps look like. Yeah, one thing to mention as well, the company did not change its forecast today for its first quarter. Even though it's cutting the dividend, reiterated its forecast for the current period.
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