After posting a double-digit income decline for its fourth quarter of 2022, Intel is seeking to climate a doubtlessly problematic 2023 by making companywide cuts to worker pay.

Responding to media stories about doable pay cuts, Intel mentioned on Wednesday that to be able to navigate “macro-economic headwinds and work to scale back prices throughout the corporate,” it has made a number of changes to its 2023 worker compensation and rewards packages.

“[These changes] will assist assist the investments and general workforce wanted to speed up our transformation and obtain our long-term technique,” the assertion continued. “We’re grateful to our staff for his or her dedication to Intel and endurance throughout this time as we all know these modifications will not be simple.”

Although Intel didn’t disclose particulars of the pay-cut plan, midlevel staff could have their salaries reduce by 5% and senior leaders might be confronted with reductions of 10%, in keeping with a media report confirmed by Reuters. The corporate’s high executives could have their pay slashed by 15%, whereas Intel’s CEO Pat Gelsinger can even be chopping his base wage by 25%.

The information outlet additional reported that Intel might be halving 401(okay) contributions and suspending merit-based pay raises and quarterly efficiency bonuses. Nonetheless, regardless of the wide-ranging cost-cutting measures, staff which might be paid hourly won’t be seeing a discount in pay, it mentioned.

Intel’s poor fourth quarter efficiency was not a shock, given that almost all consumer-facing companies proceed to see weak demand, mentioned Mario Morales, group vice chairman of enabling applied sciences and semiconductors at IDC. Poor gross sales of PC and server chips has led to weak demand for semiconductors.

“I count on it to be a protracted restoration for Intel as a result of inventories won’t backside till mid-year, and it’ll not be till the top of the 12 months going into 2024 once we begin seeing 12 months over 12 months progress for the semiconductor business,” Morales mentioned, including that the corporate should hit every product in its roadmap over the subsequent 12 months whether it is to face an opportunity at restoration.