Intel’s leadership, under new CEO Lip-Bu Tan, decided to streamline operations and focus on core business units to boost efficiency. The company faces fierce competition from rivals like Nvidia and TSMC, which have outpaced Intel in artificial intelligence and advanced chip manufacturing. Intel’s first-quarter 2025 financial report showed an $821 million loss, highlighting urgent needs for cost-cutting and operational changes. Management wants to remove organizational complexity, empower engineers, and return Intel to an engineering-first culture.
The layoffs will hit Intel’s Foundry division hardest, impacting technicians, engineers, and researchers across global production hubs, especially in Oregon. Intel employs around 109,000 people worldwide, with approximately half working in manufacturing roles, so this reduction will affect over 10,000 jobs. The company will base layoffs on project priorities, performance, and skill assessments, with no voluntary buyouts offered this time. Teams have received instructions to implement cuts according to new strategic priorities set by top leadership.
Intel battles sinking sales, weak PC demand, and lagging AI chip development. Competitors like TSMC and AMD outpace Intel in innovation and market share 68%. CEO Lip-Bu Tan aims to strip bureaucracy, refocus on engineering, and stabilize finances. However, mass layoffs risk morale and operational agility.
Intel aims to become leaner and more competitive by focusing on core products and maximizing operational cost savings and capital efficiency. The company hopes these changes will help it regain ground in the fast-evolving semiconductor market and restore investor confidence.
