US company Intel lost more than a quarter of its value on Friday after unveiling radical plans to cut staff and capital expenditure, the Financial Times reported.
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Chief Executive Pat Helsinger's emergency steps to return the Silicon Valley icon to sound financial footing include a 15 percent cut in its workforce, or about 15,000 jobs, with most of the positions to be eliminated this year.
To shore up its flagging finances, Intel also canceled its dividend and announced a surprise reversal of its steep capital spending, with investments this year likely to be 20 percent less than forecast.
Shares fall
Shares of the American chipmaker fell 26% on Friday, August 2, amid a broader sell-off in the stock market. That topped the 10 percent drop seen since Intel's last earnings report.
The Financial Times said it was another major blow to Wall Street's confidence in Helsinger's ability to deliver on his ambitious turnaround plan.
Shares of other semiconductor companies also fell on Friday after Intel's latest quarterly results, including chip equipment maker ASML (-9%) and supplier Tokyo Electron (-12%).
Although most analysts praised Helsinger for ridding Intel of long-standing shortcomings in its core manufacturing technology, he was less successful in recapturing the market share that Intel lost to rival AMD and capitalizing on a booming demand for artificial intelligence chips.
