The management team believes this is the case. They have a lot of information on the company and individual performance. Do you have any reason to believe they are wrong with this particular choice?
What is beneficial to management may or may not actually be in the best interest of shareholders (and neither incentive necessarily aligns with the interests of either customers or employees).
If you believe Intel will be profitable again in the near future then paying the dividend really does make sense. Unfortunately there have been lots of companies that thought that was true when it wasn't and the dividend is how they ran out of runway quick.
If you believe your company will be profitable you should reinvest all avaliable capital into the business to grow it.
What you are advocating is contrary to every shred of logic and common sence.
No, because being profitable doesn’t mean marginal profits from expansion are available. Your plan would have all profitable firms expanding until they collapse from overextension.
This should not be true for microchip manufacturer during global computerisation. We now have microchips in sofas and handbags.
No? Then they are under investing in R&D. It's been a while since M1 came out and intel CPUs still havent caught up.
They GPUs are lacking too. Apply has AI inference functionality in their chips and great ML software support.
You don't get to tell me that they have nowhwre to invest when they are losing on multiple fronts.
I am not even mentioning the fact that they should be finding foundamentally new opportunities ahead of their competitors.
A month ago, would you would have believed that management team is right hire these people?
Did they make a mistake when they were hiring or did they make a mistake now when they are firing?
You cant believe both simultaneously.
Alternatively, maybe management team is just out for themselves, doesn't care. , and is just riding the wave. Pumo the share price.
Or maybe they are incompetent, don't know how to apply a large team, are out of ideas on how to invest 1.6 billion dollars profitably.
Now I dont have proof for my hypothesis b, but at least I am mot contradicting myslelf.
No it's entirely plausible that hiring then was the right decision and firing now is the right decision. There's no universal law that says you must hire people for eternity.
Why do you feel the urge to make excuses for managerial incompetence.
Like when you are a worker, they must be scruitinised to make sure they arent lazy or incompetent, but the day you get promoted to executive you gain godlike immunity from criticism
In the past 40 years several FTSE 250 companies have collapsed, gone bancrupt or suffered some other disaster.
I can't name any example where shareholders replaced upper management before it was too late. Can you?