Intel Corporation has confirmed plans to reduce its global workforce to approximately 75,000 employees by the end of 2025, marking a significant downsizing from its 2024 headcount of 99,500.
The move is part of a broader restructuring strategy led by CEO Lip-Bu Tan, aimed at streamlining operations, cutting costs, and repositioning the company in a rapidly evolving semiconductor market.
The decision comes as Intel grapples with steeper-than-expected losses, competitive pressures, and a need to refocus on core business areas, particularly AI chip development and next-generation manufacturing processes.
Intel Strategic Reset Under New Leadership
Since taking over in March 2025, CEO Lip-Bu Tan has initiated a series of reforms to address Intel’s declining market share and operational inefficiencies.
These include:
- Reducing management layers by approximately 50%
- Divesting non-core businesses, including a 51% stake in Altera for $4.46 billion
- Reevaluating Intel’s chip foundry ambitions, particularly the 18A manufacturing process, which may now be reserved for internal use only
Tan emphasized a shift toward financial discipline, stating, “Every investment must make economic sense. We will build what our customers need, when they need it, and earn their trust through consistent execution”.
Scope and Impact of Job Cuts
Intel’s workforce reduction will affect over 24,000 roles, implemented through a combination of layoffs, attrition, and project cancellations.
The company has already begun notifying employees in Oregon, California, Arizona, and New Mexico, with further consolidation planned in Costa Rica, Germany, and Poland.
Intel CFO David Zinsner noted that the company expects to save $17 billion over the next year through these measures.
Restructuring costs for Q2 alone amounted to $1.9 billion, driven largely by severance and operational adjustments.
Financial Performance and Market Outlook
Intel’s Q2 2025 revenue was reported at $12.9 billion, slightly above analyst expectations and ending a four-quarter streak of declining sales.
However, the company forecasted a Q3 loss of 24 cents per share, deeper than Wall Street’s estimate of 18 cents.
Despite the losses, Intel’s stock has seen a 14% increase this year, reflecting investor optimism about Tan’s turnaround strategy.
Still, challenges remain, including:
- Limited presence in the booming AI chip market, dominated by Nvidia
- Eroding share in PC and server processors, where AMD continues to gain ground
- Uncertainty in global trade policies and customer spending behavior
Intel Project Cancellations and Operational Shifts
Intel has scaled back plans for large fabrication facilities in Germany and Poland, which were expected to generate thousands of jobs.
The company is also slowing construction in Ohio to align spending with market demand.
Operations in Costa Rica will be partially relocated to Vietnam, affecting assembly and testing functions, though some facilities will remain active.
Industry Reaction and Future Outlook
Industry analysts view the restructuring as a necessary correction after years of strategic missteps.
Ben Bajarin, CEO of Creative Strategies, noted, “This is the painted picture of a new fiscally disciplined base… I think that’s the right approach”.
Intel’s future now hinges on the success of its upcoming Panther Lake and Nova Lake processors, as well as its ability to regain relevance in AI and mobile chip segments.
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