Intel Corporation, one of the world’s leading semiconductor manufacturers, has announced plans to reduce its workforce by over 20%.
This decision comes as part of a broader restructuring strategy under the leadership of its newly appointed CEO, Lip-Bu Tan.
The move aims to streamline operations, eliminate bureaucratic inefficiencies, and refocus the company on its core engineering-driven culture.
The layoffs, expected to impact approximately 21,000 employees, mark a significant shift in Intel’s approach to addressing its ongoing financial and strategic challenges.
Reasons Behind the Workforce Reduction at Intel
Intel’s decision to cut over 20% of its workforce stems from high operational costs and shrinking profit margins.
Additionally, the company faces increased competition within the semiconductor industry.
The company has faced mounting pressure to regain its technological edge, particularly in the fields of artificial intelligence (AI) and advanced chip manufacturing.
Intel faces difficulties in competing with rivals like Nvidia in AI computing.
Its challenges are further amplified by competition from Taiwan Semiconductor Manufacturing Company (TSMC) in chip production.
The layoffs are part of a larger effort to rebuild Intel’s engineering culture and streamline its management structure.
CEO Lip-Bu Tan, who took over in March 2025, has emphasized the need for “tough decisions” to turn the company around.
His strategy includes flattening the leadership hierarchy and spinning off non-core assets to focus on Intel’s primary mission.
Intel Layoffs: Impact on Employees and Operations
The workforce reduction will affect employees across various departments, with a significant focus on middle management roles.
This follows a previous round of layoffs in August 2024, which saw the elimination of 15,000 positions.
Intel’s global headcount stood at 108,900 employees at the end of 2024, down from 124,800 the previous year.
The latest layoffs are expected to bring the total workforce to approximately 87,000 employees.
While the layoffs aim to improve operational efficiency, they also raise concerns about the morale and well-being of the remaining workforce.
Intel has pledged to provide support and resources to affected employees, including severance packages and career transition assistance.
Strategic Focus and Future Plans
As part of its restructuring efforts, Intel has announced plans to divest non-core assets and prioritize investments in AI and advanced chip technologies.
Earlier this month, the company sold a 51% stake in its programmable chips unit, Altera, to private equity firm Silver Lake Management.
This move aligns with Intel’s goal of reallocating resources to high-growth areas and creating more compelling products.
CEO Lip-Bu Tan has also highlighted the importance of replacing lost engineering talent and improving manufacturing processes to meet customer demands.
Intel’s upcoming first-quarter earnings report is expected to provide further insights into the company’s strategic direction and financial performance.
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