Intel Offloads Arm Holdings; Retains Astera, Joby, MariaDB

Intel is in a tight spot, grappling with financial strain by cutting dividends and reducing its workforce. The company has now sold all of its stake in Arm Holdings as part of its efforts to conserve cash and raise funds.

Currently, Intel is experiencing a significant downturn, failing to meet analysts' expectations for both revenue and profits in Q2 2024. The company also struggled with disappointing results in its DCAI segment, highlighting its difficulty in capitalizing on the growing AI sector.

Intel missed its own gross margin guidance for the last quarter and has forecasted further challenges. In response, the company has announced it will lay off 15,000 employees, representing 13.6% of its workforce, following a previous 5% reduction.

Despite these cuts, Intel still maintains investments in Astera Labs, Joby Aviation, MariaDB, and Senti Biosciences. The company has reported a cumulative loss of $120 million on equity investments for Q2 2024.

Recent reports from Bernstein analysts suggest that the desktop and notebook CPU market is clearing out excess inventory, which could benefit Intel moving forward. The company’s Q2 revenue included about $1.3 billion from incentivized sales, a trend that has been noted as potentially impacting future performance.

Although Intel's stock saw a 6% increase recently, it remains down 40% over the past month.