Intel cuts down CEO pay by 25% amidst companywide reduction

As per Intel, its Chief Executive Officer Pat Gelsinger is taking a 25% cut to his base salary. His executive leadership team will see their pay packets decreased by 15%. Senior managers will take a 10% reduction, and the compensation for mid-level managers will be cut by 5%. The move comes after the company predicted one of the worst quarters in its more than 50-year history.

Intel said in a statement, “As we continue to navigate macroeconomic headwinds and work to reduce costs across the company, we’ve made several adjustments to our 2023 employee compensation and rewards programs. These changes are designed to impact our executive population more significantly and will help support the investments and overall workforce needed to accelerate our transformation and achieve our long-term strategy.”

At the same time, Gelsinger wants to invest in the company’s future. He is two years into a turnaround effort aimed at restoring Intel’s technological leadership in the $US580 billion ($820.6 billion) chip industry.

Gelsinger will keep using cash to reward shareholders. Intel said last week that it remained committed to offering a competitive dividend. Analysts have speculated that the company may lower its payout to cope with the slowdown.

Under Gelsinger’s plan, the company plans to introduce new production technology at an unprecedented pace. It will also build new plants in Europe and the US and try to win orders from other chipmakers as an outsourced manufacturer. That will put Intel in direct competition with Taiwan Semiconductor Manufacturing Co and Samsung Electronics Co, two Asian companies that have passed it in the rankings of chipmakers by size and capabilities.

Intel is not the only big company trimming executive pay. Apple, one of the few tech giants to forgo major layoffs, is cutting the pay of CEO Tim Cook by more than 40 per cent to $US49 million for 2023.