Imagine my surprise to discover that, last year, almost to the day, I made the joke that I was about to make here today. There, I pointed out a Dilbert strip that noted that cutting “marcom”, or marketing / communications, is part of a “death spiral” for businesses. Chip stock Intel (INTC) decided to let history repeat itself nearly 11 months later by outsourcing its marketing department altogether. Intel shares dropped similarly to what happened the last time they cut marketing, and lost modestly in Friday afternoon’s trading.
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Back in August 2024, Intel was planning to cut its marketing department as part of a move to cut costs, a move that has only expanded with the arrival of CEO Lip-Bu Tan. And now, the cuts continue, as Intel moves its marketing operations to Accenture (ACN). As it turns out, Intel will be turning to a combination of Accenture and artificial intelligence (AI) to do the job. Worse, Intel believes that Accenture will “…do a better job connecting with customers than Intel’s own marketing organization has,” reports suggest, which is absolutely not a phrase you want on your resume.
The result? “The transition of our marketing and operations functions will result in significant changes to team structures, including potential headcount reductions, with only lean teams remaining,” noted a statement from Intel. There is also a possibility that some elements of Intel’s marketing will be obliged to train their replacements.
Another Price Cut
As bad as the news was for Intel’s marketing operations, it did get better for Intel’s customer base. Reports noted that Intel had once again cut prices on the Core Ultra 7 265KF processor. This is the second such cut in as many months, reports note. The processor is now not only priced at its lowest level ever, but is now 40% cheaper than it was when it first hit shelves.
The downside, for those considering a processor buy, is that the F variants—of which this is one—does not include a graphics processing unit (GPU) included. Thus, those using this processor will need a separate graphics card to go with it. Still, with that kind of price cut, a better graphics card could be added to the list for about the same price, and potentially, some savings as well.
Is Intel a Buy, Hold or Sell?
Turning to Wall Street, analysts have a Hold consensus rating on INTC stock based on one Buy, 26 Holds and four Sells assigned in the past three months, as indicated by the graphic below. After a 30.88% loss in its share price over the past year, the average INTC price target of $21.30 per share implies 0.35% upside potential.
