Intel aims to cut Sales and Marketing Group costs by 35% this year, indicates internal slide — jobs and marketing programs under threat

Intel
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Intel’s Sales and Marketing Group (SMG), which works with companies to help them solve business problems using Intel technologies, is targeting a 35% reduction in costs, as revealed during an all-hands meeting for the group on August 5. This massive cut will affect jobs and marketing expenses, with everyone given the directive to “simplify programs end-to-end” by the end of the year. This grim news comes soon after the company announced that it would lay off 15% of its workforce — counted to be more than 15,000 employees.

The semiconductor and processor giant said in a statement to CRN, “We are becoming a simpler, leaner, and more agile company that’s easier for partners and customers to work with while ensuring we focus our investments on areas where we see the greatest opportunities for innovation and growth.” Intel added, “This is all about building a stronger Intel for the future, and our partners are integral to our future plans.”  

One of the most painful things that needs to happen at Intel SMG concerns the specific job cuts it needs to make. One way it could accomplish this is by reducing positions with overlapping responsibilities. This includes employees handling customer accounts and teams that focus on certain industries. Sources say that these kinds of overlap can make it confusing for customers to know who their point of contact is, as they must interact with both salespeople who take care of the account and other Intel employees who don’t have any ownership of it.

Another way that the SMG could save on costs is by reducing its marketing budget and simplifying programs. Intel expects to save at least $100 million by doing this in the latter half of 2024, with an additional $300 million in savings for 1H25. Aside from the monetary benefits, this simplification would also “enable faster decision [making] and [return on investment] measurement.”

Intel’s market development fund (MDF) will also be greatly impacted by the signaled cuts. The MDF plays an important role in Intel’s marketing efforts, as OEMs and other Intel partners can tap into these funds to host events, training, and more. A former Intel executive even said that the MDF played an important part in helping Intel to win business, even as its products lost their competitive edge.

“Intel lost their mojo on product leadership, and the most valuable thing we were still able to offer the partners was the sales and marketing relationship and the funding,” the former executive told CRN.

Another Intel partner executive who asked not to be named remarked to CRN that, “They’re investing in the foundry. They have to do that. But they’re trying to also get this business back on its feet at the same time, and doing two things at once is nearly impossible, so something’s got to give.” But they also told CRN they were concerned about how these cuts and reductions would affect Intel’s services to its partners and customers.

Jowi Morales
Contributing Writer

Jowi Morales is a tech enthusiast with years of experience working in the industry. He’s been writing with several tech publications since 2021, where he’s been interested in tech hardware and consumer electronics.

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  • Marlin1975
    Wow... seems everyday they keep having more bad news. Not just 1 area but all now.
    Reply
  • bolweval
    "what exactly would you say you do here?"

    "Well--well look. I already told you: I deal with the god damn customers so the engineers don't have to. I have people skills; I am good at dealing with people. Can't you understand that? What the hell is wrong with you people?

    Intels about to do Office Space...
    Reply
  • dalek1234
    "Intel CEO: Meteor Lake Will Be Our Next 'Centrino Moment'"

    That statement turned out to be total BS. I would argue that by saying that, Pat was doing 'marketing' himself. Maybe he should be part of the 35% that gets fired.
    Reply
  • enhost
    "We were caught by surprise by the lower demand of our products and missed revenue. Since we dropped the ball, then we must fire other people who are not us and have nothing to do with our incompetence." -Pat
    Reply