Intel's Strategic Shake-Up: Capital Spending Cuts and Business Sales Loom

Intel CEO Pat Gelsinger and key executives are set to propose a strategic plan to the board aimed at cutting costs by selling non-essential businesses like Altera. The plan, which includes reducing capital spending on factory expansions, is part of Intel's broader effort to recover from poor financial performance.

Intel CEO Pat Gelsinger, along with other key executives, plans to present a significant cost-cutting strategy to the company's board later this month. Insiders reveal that the proposal includes shedding non-essential businesses, like the Altera programmable chip unit, to manage Intel's financial woes.

The plan, expected to be revealed at a mid-September board meeting, will not suggest splitting Intel or selling off its contract manufacturing operations. However, it aims to curb capital spending on factory expansions, including a potentially paused $32 billion project in Germany.

Intel has engaged Morgan Stanley and Goldman Sachs to advise on business sales. This move follows a troubled quarter marked by a 15% staff cut and paused dividends. Investors and analysts anticipate critical decisions at the upcoming board meeting that could redefine Intel's future.

(With inputs from agencies.)