The Intel Dividend Cut: What It Means for Investors
In what is likely not a surprise, Intel (NASDAQ: INTC) announced last week that it was slashing its dividend by 66%. Declining revenue and net losses likely necessitated this move as it seeks to make a comeback in the industry it created.
However, the semiconductor stock's share price did not fall significantly following the news, indicating that the move wasn't a big surprise and that it might bring relief along with disappointment to shareholders. Also, with the capital the cut frees up now available for other purposes, slashing the payout could benefit Intel in the longer term.
The Intel dividend cut resolves an issue that has been growing more concerning for some time. Even as financials had deteriorated and the stock price fell, the company continued to hike the payout annually. The previous payout hike took effect in early 2022 and increased the payout by 5%, taking it to a quarterly level of $0.365 per share.
Source Fool.com
