Intel Corporation is set to cut more than 20% of its global workforce, in what could be one of the largest rounds of layoffs in its history, according to a report by Bloomberg News citing internal sources. The move comes as newly appointed CEO Lip-Bu Tan embarks on a sweeping transformation to reposition the beleaguered chipmaker as a competitive force in the global semiconductor and AI markets.
While Intel has yet to issue an official comment, its shares surged by over 4.5% in premarket trading on April 23 following the report.
Rebuilding from the Inside Out
The job cuts are part of a broader attempt to streamline operations, reduce bureaucratic layers, and foster an engineering-driven culture that once defined Intel’s dominance in chip manufacturing.
The company, which employed 108,900 people as of the end of 2024, has already undergone significant downsizing. This includes a 15% workforce reduction announced last August under former CEO Pat Gelsinger, whose ambitious turnaround strategy failed to meet the expectations of Intel’s board and investors.
Tan, who assumed the CEO role just last month, appears to be accelerating those efforts with a sharper focus on AI innovation, leadership restructuring, and renewed investment in core engineering competencies.
Manufacturing Delays and Strategic Pivots
Intel is currently undertaking a $28 billion project to construct two advanced microchip facilities in New Albany, Ohio. Initially slated to open this year, the project has faced repeated delays due to financial headwinds, highlighting the firm’s ongoing operational and strategic challenges.
The layoffs also come on the heels of Intel’s uncertain AI roadmap. While the company recently appointed a new AI chief and has been reorienting its business to prioritize artificial intelligence, its Falcon Shores AI chip has been relegated to internal testing. This has effectively left Intel without a flagship AI processor capable of competing with dominant rivals like Nvidia, further eroding its market position.
Challenges on the Horizon
Tan’s restructuring campaign is expected to be further tested by geopolitical tensions — notably the escalating U.S.-China trade dispute and potential retaliatory tariffs that could disrupt global chip supply chains.
The upcoming release of Intel’s Q1 2025 earnings report, scheduled for Thursday, is expected to provide a clearer picture of the new CEO’s direction and the extent of the company’s financial and operational reset.
Market Reaction and Industry Implications
The tech sector has been under significant pressure over the past year, with several companies resorting to workforce reductions to weather market volatility and evolving consumer demands. Intel’s move, while drastic, underscores the urgency of regaining relevance in an industry now increasingly shaped by AI, custom silicon, and advanced manufacturing capabilities.
Industry analysts say the planned layoffs could signal the start of a deeper transformation — one aimed at restoring Intel’s position as a technological leader after years of missed opportunities and strategic misfires.
Whether Tan's aggressive restructuring delivers long-term gains or further destabilizes the company remains to be seen. But one thing is clear: Intel’s next chapter will be defined by bold — and risky — choices.