Intel today announced a restructuring initiative to accelerate its transition from a PC company to one that powers the cloud and billions of smart, connected computing devices. The data center and Internet of Things (IoT) businesses are Intel’s primary growth engines, with memory and field programmable gate arrays (FPGAs) accelerating these opportunities - fueling a cycle of growth for the company. These growth businesses delivered $2.2 billion in revenue growth last year, and made up 40 percent of revenue and the majority of operating profit, which partially offset the decline in the PC market segment.

The restructuring initiative was outlined in an e-mail from Intel CEO Brian Krzanich to Intel employees.

"Our results over the last year demonstrate a strategy that is working and a solid foundation for growth," said Krzanich. "The opportunity now is to accelerate this momentum and build on our strengths.

"These actions drive long-term change to further establish Intel as the leader for the smart, connected world,” he added. “I am confident that we’ll emerge as a more productive company with broader reach and sharper execution."

While making the company more efficient, Intel plans to increase investments in the products and technologies that that will fuel revenue growth, and drive more profitable mobile and PC businesses. Through this initiative, the company plans to increase investments in its data center, IoT, memory and connectivity businesses, as well as growing client segments such as 2-in-1s, gaming and home gateways.

These changes will result in the reduction of up to 12,000 positions globally - approximately 11 percent of employees - by mid-2017 through site consolidations worldwide, a combination of voluntary and involuntary departures, and a re-evaluation of programs. The majority of these actions will be communicated to affected employees over the next 60 days with some actions spanning in to 2017.

Intel expects the program to deliver $750 million in savings this year and annual run rate savings of $1.4 billion by mid-2017. The company will record a one-time charge of approximately $1.2 billion in the second quarter.

Intel also announced first-quarter 2016 earnings today. The company reported Non-GAAP revenue of $13.8B - down 7% sequentially and up 8% on a year-on-year basis.

Total platform volumes (Client Computing Group, Data Center Group, and Internet of Things Group microprocessors and chipsets) were 15% when compared to the fourth quarter. Total platform average selling prices were up 3% over this same time period.

During the first quarter of 2016:

• Intel's Client Computing Group revenue was $7.5 billion, down 14 percent sequentially and up 2 percent year-over-year
• Data Center Group revenue of $4.0 billion, down 7 percent sequentially and up 9 percent year-over-year
• Internet of Things Group revenue of $651 million, up 4 percent sequentially and up 22 percent year-over-year
• Non-Volatile Memory Solutions Group revenue of $557 million, down 15 percent sequentially and
  down 6 percent year-over-year
• Intel Security Group revenue of $537 million, up 5 percent sequentially and up 12 percent year-over-year
• Programmable Solutions Group revenue of $359 million, which does not include $99 million of revenue as a result of acquisition-related adjustments.

"Our first-quarter results tell the story of Intel’s ongoing strategic transformation, which is progressing well and will accelerate in 2016," said Brian Krzanich, Intel CEO. "We are evolving from a PC company to one that powers the cloud and billions of smart, connected computing devices."

The company also said on Tuesday Chief Financial Officer Stacy Smith will move to a new role leading sales, manufacturing and operations. Intel said it would begin a formal search process for a successor.