Intel Layoffs: Tech Firm To Fire Over 20% Of Employees; Here's Why

Intel Layoffs: Intel is set to report its first-quarter earnings on Thursday, providing Tan with a key opportunity to further outline his strategic vision

At last month’s Intel Vision conference, CEO Lip-Bu Tan stressed the urgent need to rebuild the company’s engineering bench, strengthen its balance sheet, and align its manufacturing operations more closely with customer demands

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Intel is set to announce plans this week to cut more than 20 per cent of its workforce in a move aimed at reducing bureaucracy and reviving its engineering-focused culture, according to a Bloomberg report citing sources familiar with the matter.

The restructuring marks the first major shake-up under newly appointed CEO Lip-Bu Tan, who took over last month. It follows a previous round of layoffs in August, which saw approximately 15,000 jobs cut. As of the end of 2024, Intel’s workforce had already shrunk to 108,900 employees, down from 124,800 the year before, states the report.

CEO Lip-Bu Tan is working to revive Intel’s fortunes after years of losing ground to competitors. Once the industry leader, the chipmaker has fallen behind in key areas like artificial intelligence, particularly against Nvidia, leading to three consecutive years of declining sales and deepening losses.

A veteran of Cadence Design Systems, Tan has pledged to refocus Intel by shedding non-core assets and delivering more competitive products. As part of that strategy, the company recently agreed to sell a 51 per cent stake in its programmable chip unit, Altera, to Silver Lake Management.

Restructuring Efforts

At last month’s Intel Vision conference, CEO Lip-Bu Tan stressed the urgent need to rebuild the company’s engineering bench, strengthen its balance sheet, and align its manufacturing operations more closely with customer demands, it added.

Intel is set to report its first-quarter earnings on Thursday, providing Tan with a key opportunity to further outline his strategic vision. While analysts believe the steepest of Intel’s revenue declines are now in the rearview, Wall Street does not expect the company to return to its former sales heights anytime soon, if at all, reveals the report.

Tan was brought in following the departure of former CEO Pat Gelsinger, who was removed last year after struggling to execute his turnaround plan. Gelsinger had pursued an ambitious and expensive strategy to expand Intel’s manufacturing footprint and reposition the company as a major player in the custom chipmaking business.