February 23, 2023: -On Wednesday, Intel shortened its quarterly bonus from 36.5 cents to 12.5 cents, the chipmaker stated after the company executed a wide-ranging set of expenditure cuts.
Intel CEO Pat Gelsinger stated in talks with analysts that the firm’s board was cautious in weighing Intel’s first dividend cut since 2000. He added the company intended to start growing the dividend “over time.”
“The board and I continue to take care of the dividend as a key component to the complete attractiveness of Intel,” he said.
On Wednesday, Intel shares were flat in premarket trading after the news.
Gelsinger insisted on the call that he and the board remained committed to taking care of a competitive yield. Based on Tuesday’s closing price, Intel’s dividend yield is now 1.9%, down significantly from its initial yield of 5.6%.
The dividend is payable on June 1. “Prudent allocation of our owners’ capital is vital to help our IDM 2.0 strategy and sustain our momentum as shaping our execution engine,” Gelsinger stated in a press release.
The company confirms its recently issued outlook for the first quarter of 2023. Intel guided to a 15-cent non-GAAP loss per share but didn’t provide full-year guidance, which cited economic uncertainty.
Intel’s latest results, a vital miss and a $664 million overall loss for the last quarter of the previous year, sharply decreased its share price. “No words can portray or state the historical decrease of Intel,” Rosenblatt analyst Hans Mosesmann wrote following the earnings report.
Intel’s stock has decreased nearly 60% from its 2021 high, reflecting both a challenging PC market and company-specific issues, including a surplus of chips and underutilized factories.
The company aimed to deliver $3 billion in cost savings this year, partly through compensation slashes. Intel’s fourth-quarter loss was the chipmaker’s most significant since 2017.