- Intel (INTC) announced on Feb. 22, 2023, that it had reduced its quarterly dividend by two-thirds.
- The semiconductor manufacturer believes that the move will improve its financial flexibility.
- The company's other recent cost-cutting moves have included layoffs, employee compensation cuts, and reductions in operating expenses.
Intel (INTC) slashed its dividend as part of the chip company's latest effort to cut costs with demand for its products sinking following the pandemic boom.
Intel announced it has reduced its quarterly dividend by two-thirds, from 36.5 cents to 12.5 cents. It said the decision "reflects the board's deliberate approach to capital allocation and is designed to best position the company to create long-term value."
Intel said the move will improve financial flexibility, which will "support the critical investments needed to execute Intel's transformation during this period of economic uncertainty." CEO Pat Gelsinger added that prudent allocation of capital is important "as we rebuild our execution engine."
The company noted it has taken several steps to improve its financial position recently, including creating $3 billion in savings in 2023 through layoffs, reductions in employee compensation, and cuts in other operating expenses.
In the statement, Intel also reaffirmed the current quarter outlook it gave when it released fourth quarter results last month.
Intel shares dropped 2% on Feb. 22, and they've plunged 43% over the past year.