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Intel is preparing to cut more than 20% of its workforce as part of a sweeping effort to eliminate bureaucracy and rebuild its engineering-driven culture.
he move represents the first major restructuring initiative under new Chief Executive Officer Lip-Bu Tan, who assumed leadership of the struggling chipmaker just last month.
The layoffs come amid broader challenges facing the tech sector and are a decisive shift for Intel as it seeks to regain market share after years of falling behind competitors. Intel had 108,900 employees at the end of 2024, down from 124,800 the year before, following a separate reduction of approximately 15,000 roles announced last August.
So far this year there have been 28,728 layoffs in the tech sector according to Layoffs.fyi. In 2024 there were more than 150,000
According to a source familiar with the matter, the planned cuts aim to streamline management layers and better position Intel to focus on innovation. Intel has not publicly commented on the reports.
Leadership transition marks turning point for Intel
The restructuring follows a turbulent period under previous CEO Pat Gelsinger, who had launched an ambitious (but costly) effort to expand Intel’s manufacturing capabilities. Gelsinger’s vision of turning Intel into a leading made-to-order chip manufacturer ultimately fell short, and the company's factory expansion, including a highly publicized Ohio project, has now been significantly delayed.
Tan’s arrival signals a new direction. The former Cadence Design Systems executive has already begun reshaping the company’s portfolio, including the recent sale of a 51% stake in Intel’s programmable chips unit Altera to private equity firm Silver Lake Management.
In his first public appearance as CEO at the Intel Vision conference, Tan acknowledged the scale of the challenge ahead. “It won’t happen overnight,” he said. “But I know we can get there.” He emphasized the need to replace lost engineering talent, strengthen the balance sheet, and better align manufacturing operations with customer demand.
Intel’s AI shortfall highlights industry shift
One of Intel’s most critical setbacks has been its slow response to the rise of artificial intelligence. While the company historically dominated the personal computer and data center processor markets, it missed the early opportunity to lead in AI computing, a sector that has propelled rivals like Nvidia to record valuations and revenues that now exceed Intel’s.
Investor hopes of a manufacturing partnership with Taiwan Semiconductor Manufacturing Company have also cooled, with TSMC’s leadership stating their intention to prioritize internal operations.
Intel is scheduled to report its first-quarter results on Thursday, giving Tan a platform to outline more detailed plans for the company’s future. Although analysts suggest the worst of Intel’s revenue declines may have passed, few expect the firm to return to its previous sales levels in the near term.
The upcoming announcements will be watched across the tech industry, as HR leaders and business executives grapple with ongoing uncertainty and workforce transformation in the sector.
