Intel Cuts Employee Pay to Maintain Quarterly Dividend
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Intel Cuts Employee Pay to Maintain Quarterly Dividend
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Re: Intel Cuts Employee Pay to Maintain Quarterly Dividend
#2It would be interesting if the result is a decline in stock price due to this prioritization of dividend, as both are of interest to shareholders.
10-15% cut by senior managers, that piece of it is positive.
Re: Intel Cuts Employee Pay to Maintain Quarterly Dividend
#3Wasn’t a cut of employee pay how they got into trouble in the first place?
Re: Intel Cuts Employee Pay to Maintain Quarterly Dividend
#4It would be interesting if the result is a decline in stock price due to this prioritization of dividend, as both are of interest to shareholders. 10-15% cut by senior managers, that piece of it is positive.
Maybe if it was 10-15% of senior managers being cut.
Re: Intel Cuts Employee Pay to Maintain Quarterly Dividend
#5Microsoft and Intel and the PC makers all seem to be in a deadlock
Microsoft can't rethink Windows because they will never corral the PC makers on a reasonable timetable
PC makers are still selling the same laptops as four years ago (modulo minor spec bumps) because Windows is basically the same OS as four years ago (modulo some UI fluff). Intel and AMD are stuck in the middle waiting for the deadlock to break...but the only winner is Apple.
Re: Intel Cuts Employee Pay to Maintain Quarterly Dividend
#6When bailed out banks paid bonuses it was understandably unpopular, but there was a certain logic that retaining talent optimized performance of the remaining bank, and therefore it was ultimately in the interest of taxpayers.
It seems surprising that Intel either doesn't think that retaining top talent is in the interest of shareholders, or thinks that investors aren't able to understand the investment. I would assume that investors who are still invested in Intel were holding out for the prospect that Intel would recover its former glory, but maybe it is mostly investors interested in near term dividend yields, or institutional investors that are sensitive to metrics other than something that is difficult to quantify like narratives or some notion of employee quality.
Re: Intel Cuts Employee Pay to Maintain Quarterly Dividend
#7When bailed out banks paid bonuses it was understandably unpopular, but there was a certain logic that retaining talent optimized performance of the remaining bank, and therefore it was ultimately in the interest of taxpayers. It seems surprising that Intel either doesn't think that retaining top talent is in the interest of shareholders, or thinks that investors aren't able to understand the investment. I would assu…
I don’t know who is invested in Intel that's betting on anything but a high risk high reward underdog story comeback. Intel already was undercompensating to the point of driving the talent out of their company to begin with. These wage cuts are a sign for investors to flee faster because management lacks coherence.
Management seems to be betting on a strategy of promising the world to gain government subsidies while in reality cutting costs and letting the business wither and die and I don’t know if that justifies the valuation.
Re: Intel Cuts Employee Pay to Maintain Quarterly Dividend
#8Pay cuts are better than layoffs. That said, investors need to take a paycut in dividends as well.
Re: Intel Cuts Employee Pay to Maintain Quarterly Dividend
#9When bailed out banks paid bonuses it was understandably unpopular, but there was a certain logic that retaining talent optimized performance of the remaining bank, and therefore it was ultimately in the interest of taxpayers. It seems surprising that Intel either doesn't think that retaining top talent is in the interest of shareholders, or thinks that investors aren't able to understand the investment. I would assu…
This is very plausible.
Dividends are silly in a world where you can achieve the same result and save everyone 20% tax by doing stock buybacks instead. It's also silly to strongly differentiate between dividend paying stocks and non dividend paying stocks as opposed to focusing on the business' cash flow, unless you're purposely avoiding dividend paying stocks because they suck from a tax perspective.
Yet, dividends are entrenched in many investor's psyche. Even official regulatory training in the US teaches registered representative that it's a good idea to recommend dividend bearing stocks to people who want "income" from their investments, which is a fallacy. Large mutual funds also have special categories for stocks providing high dividend yields.
Sad that this is the strategy as opposed to leveraging the incredible opportunity they have from their fabs.
Re: Intel Cuts Employee Pay to Maintain Quarterly Dividend
#10Pay cuts are better than layoffs. That said, investors need to take a paycut in dividends as well.
Not in this case because the layoffs might result in a sustainable business but a paycut never will because the low comp workers left simply can’t run a globally competitive business. Intel itself wouldn’t even exist today if it didn’t layoff the great majority of its entire workforce some decades back.
Layoffs are inevitable at Intel it’s more a question of timing.