Just days after Intel reported a dismal fourth-quarter financial performance, executives announced they would be taking pay cuts, while lower-level employees would see tens of millions of dollars in benefits reductions.
CEO Pat Gelsinger and mid-level managers will be impacted, with Gelsinger seeing his base salary slashed by a quarter, or roughly $312,000 of his $1.25 million base pay.
Other drastic cost-cutting measures include reducing its 401(k) matching from 5% to 2.5%, which could save them hundreds of millions of dollars. This comes in the wake of Intel spending $489 million in 2022 to match employee contributions to qualified retirement plans, according to their annual report.
Furthermore, merit raises and quarterly bonuses will be suspended, while executive team members, senior managers and midlevel managers will experience pay cuts of 15%, 10%, and 5% respectively. Lower-level employees will remain unaffected.
“As we continue to navigate macro-economic 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,” the company stated.