Intel to slash up to 12,000 jobs in restructuring

Intel will cut up to 12,000 jobs worldwide as it seeks to shake up its business to reduce dependence on the slumping personal computer market, the US tech giant said Tuesday.

Intel, known for its role as the leading PC chipmaker, has in recent years been seeking to shift to mobile and emerging technologies such as health care, wearables and other connected devices.

The restructuring will eliminate about 11 percent of the Intel workforce by mid-2017 and aims to "accelerate evolution from a PC company to one that powers the cloud and billions of smart, connected computing devices," the California group said in a statement.

Intel shares fell 2.5 percent in after-hours trade on the news to $31.60.

"Our results over the last year demonstrate a strategy that is working and a solid foundation for growth," said chief executive Brian Krzanich.

"The opportunity now is to accelerate this momentum and build on our strengths. These actions drive long-term change to further establish Intel as the leader for the smart, connected world."

Intel made the announcement as it reported a modest three percent rise in first-quarter profit to $2.0 billion, with revenues growing seven percent to $13.7 billion.

"Our first-quarter results tell the story of Intel's ongoing strategic transformation, which is progressing well and will accelerate in 2016," Krzanich said.

Intel will be increasing investments in key growth areas, which include the range of smart home and other connected devices known as the "Internet of Things," as well as its data centers and computer memory operation.

Krzanich has spoken frequently about the shift in computing, and laid out his vision more than a year ago, telling the Consumer Electronics Show that the industry would be "unleashed" by wearables.

"So computing becomes unwired, and everything becomes smart and connected," he said at the time.

Intel said the job cuts will come from "a combination of voluntary and involuntary departures," and a re-evaluation of its global operations.

Intel will set aside $1.2 billion to cover the costs of the job reductions, and expects the program to save $750 million this year and $1.4 billion by mid-2017.

The company said chief financial officer Stacy Smith would "transition to a new role leading sales, manufacturing and operations once his successor is in place."

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