In a worrying sign for the entire industry, Intel has slashed its dividend payment to just US12.5c a share, its lowest payout in 16 years.

Intel’s current quarterly dividend is US36.5c a share, making this a 66 per cent fall. Intel share prices have fallen 43 per cent over the past twelve months.

“The decision to decrease the quarterly dividend reflects the board’s deliberate approach to capital allocation and is designed to best position the company to create long-term value,” the company said in a statement.

“The improved financial flexibility will support the critical investments needed to execute Intel’s transformation during this period of macroeconomic uncertainty.”

Intel also warned its quarterly revenue for the current period could fall to its lowest level since 2010.

Late last month, Intel forecast first-quarter 2023 sales of between A$14.7 billion and A$16.2 billion, a far cry from Wall Street estimates of $19.6 billion.

This follows one of the worst quarters in the company’s history, with a a 32 per cent year-over-year decline in revenue, and a net loss of A$906 million for the December quarter.

Intel has been cost cutting elsewhere, slashing the salaries of workers across its entire company, from the CEO down.

The chipmaker announced “several adjustments to our 2023 employee compensation and rewards programs” earlier this month, with CEO Pat Gelsinger taking a 25 per cent cut to his base salary.

Gelsinger’s executive leadership team will see a 15 per cent cut, senior managers 10 per cent, and mid-level managers a 5 per cent cut.

Intel is also reducing its budget for spending on new plants and equipment from 35 per cent of revenue to 30 per cent.