Intel Corporation announced today that it will eliminate 15,000 positions – representing 20% of its global workforce – as part of new CEO Lip-Bu Tan’s aggressive restructuring plan. The cuts mark the first major workforce reduction under Tan’s leadership since he assumed the role in March following a turbulent leadership transition.
Scope and Impact
The layoffs will primarily target Intel’s manufacturing operations, with factory workers bearing the brunt of the reductions. According to an internal memo obtained by The Oregonian, the cuts will affect “15 to 20 percent” of Intel’s foundry workforce, impacting thousands of employees across the company’s 15 wafer fabrication plants globally.
Geographic Distribution:
- Oregon: 2,932 employees (Intel’s largest private employer in the state)
- California: 1,935 employees across Santa Clara and Folsom facilities
- Arizona: 696 employees in Chandler
- Texas: 251 employees in Austin
- International: Additional cuts in Israel’s Kiryat Gat facility
CEO’s Rationale
In his memo to employees, Tan described the decision as “deeply painful but necessary to address affordability challenges and improve operational efficiency”. The 65-year-old executive, who previously served on Intel’s board until August 2024, had stepped down citing frustration with the company’s “bloated workforce.”
Tan’s Statement:
“These are difficult actions but essential to meet our affordability challenges and current financial position of the company. It drives pain to every individual. We are also taking into consideration factory operations impact.”
The CEO emphasized that no voluntary buyouts or early retirement packages would be offered, instead selecting workers based on performance evaluations and strategic investment priorities
Context of Intel’s Struggles
This latest round follows Intel’s $821 million loss in Q1 2025 and represents the company’s third major layoff in 12 months. The chipmaker previously eliminated 15,000 jobs in August 2024 under former CEO Pat Gelsinger, who had called those cuts “the hardest thing I’ve done in my career”
Financial Pressures:
- Revenue down $24 billion since 2020 despite 10% workforce growth
- Stock price fell 55% year-to-date as of June 2025
- Lagging behind Nvidia (70-95% AI chip market share) vs Intel’s projected <1%
- Manufacturing costs significantly higher than competitors
Industry Context
Intel’s struggles reflect broader challenges facing established semiconductor companies as the industry shifts toward AI-focused chips. While Nvidia has captured the AI boom, Intel has been slow to adapt, with competitors AMD increasing revenue by 9% in the past year while Intel posted consecutive losses.
Expert Analysis:
Technology analyst Jacob Bourne noted: “Intel’s aggressive cost-cutting may improve near-term financials, but layoffs alone are insufficient to redefine its position in the evolving chip market.”
Social Media and Employee Reaction
The announcement triggered widespread discussion across social platforms, with employees and industry observers expressing concern about Intel’s direction.
LinkedIn Posts:
- Multiple employees shared job loss updates with “#OpenToWork” tags
- Industry professionals questioned whether cost-cutting alone could restore Intel’s competitiveness
- Former Intel board member comments resurfaced about the company’s “suffocating” culture
Reddit Discussion:
Tech workers on r/ITCareerQuestions expressed solidarity: “15,000 people are being laid off from Intel. I guess rest in peace to trying to get a new job the rest of the year. We are truly in the dark ages of tech.”
Employee Testimonials:
Anonymous Intel workers described the atmosphere as “uncertain” and “demoralizing,” with some noting that individual business units were granted autonomy in managing reductions provided they met financial benchmarks.
Looking Ahead
Unlike his predecessor, Tan has signaled a more disciplined approach to operations. In April, he revealed plans to potentially cut over 20% of Intel’s total workforce as part of comprehensive restructuring aimed at eliminating bureaucracy.
Strategic Priorities:
- Streamlining manufacturing operations
- Reducing organizational complexity
- Empowering engineering teams
- Improving customer responsiveness
The company confirmed that affected employees will receive either 60-day or four-week notice periods, along with nine weeks of pay and benefits.
First Major Test
As Tan’s first major decision as CEO, these layoffs will test his ability to balance cost reduction with maintaining Intel’s engineering capabilities. With the semiconductor industry’s rapid evolution toward AI computing, Intel faces pressure to demonstrate it can compete while operating with a leaner workforce.
The company plans to complete the majority of cuts by the end of July, with individual departments tasked with implementing reductions while meeting senior leadership’s financial targets.
Employee Support:
Intel has pledged to treat affected workers “with care and respect” and provide job placement assistance where possible. The company emphasized that the decision followed “careful consideration” of operational needs and market conditions.
For the list of all AI layoffs, check the home page for the entire list.
