Intel CEO Slashes Workforce in High-Stakes Restructuring

Intel’s new CEO, Lip‑Bu Tan, has launched an aggressive transformation plan aimed at reviving the chipmaker’s position in a fiercely competitive market. As part of this overhaul, the company will cut up to 24,000 jobs, around 22% of its workforce, by the end of 2025, marking one of the most substantial corporate downsizings in the semiconductor industry this decade.

This shift represents more than cost-cutting. Tan is rapidly dismantling several high-spend initiatives introduced by his predecessor, including scaling back multi-billion-dollar factory projects in Ohio, Germany, and Poland. The company is also consolidating chip packaging operations, pulling out of Costa Rica in favour of expanding existing capacity in Malaysia and Vietnam. The goal: reset Intel’s manufacturing footprint in line with realistic market demand and regain operational discipline.

At the heart of Tan’s strategy is a redirection of R&D efforts. He has deprioritised the 18A process, a previously lauded breakthrough, and is refocusing on the next-generation 14A technology, but with a key caveat: no internal investments without confirmed external customers. This cautious yet focused approach suggests a shift towards leaner, more accountable innovation, where every design must earn its place through customer demand and commercial viability.

Tan’s hands-on management style stands in sharp contrast to prior leadership. Major chip designs now require his direct approval, and Intel’s foundry and design units are being restructured for closer integration. While the company reported an adjusted loss in Q2, revenue exceeded expectations - a sign that the groundwork for recovery may already be forming. However, forecasts for deeper losses in Q3 reflect the transitional strain the company must endure before seeing sustained gains.

In the high-stakes arena of AI and advanced chips, where Intel currently trails rivals like Nvidia and AMD, Tan’s radical approach may be Intel’s best shot at reclaiming relevance. The sweeping layoffs, cancelled expansions, and strategic realignments serve as a bold declaration: Intel is no longer betting on scale alone, but on precision, focus, and leadership that holds every initiative to account.