Intel is set to unveil a significant reduction of over 20% of its workforce this week, aiming to slash costs and streamline operations, according to a Bloomberg report citing an insider source. This move, impacting more than 20,000 jobs, is a cornerstone of Chief Executive Lip-Bu Tan’s strategy to revitalize the struggling chipmaker.
The restructuring seeks to eliminate bureaucratic inefficiencies and foster an engineering-centric culture. Tan, who assumed leadership last month, is focused on cutting redundant management layers, refining the company’s focus on critical projects, and prioritizing product development. This follows a prior layoffs round in August 2024, which reduced approximately 15,000 positions, primarily in non-engineering roles such as administration, sales, marketing, and support, while sparing manufacturing and core engineering teams to support Intel’s foundry goals and product innovation.
As of December 28, 2024, Intel employed 108,900 workers, including several thousand at Altera, now a separate entity co-owned by Intel and Silver Lake. The planned cuts, exceeding the number of mid-tier management roles, may signal deeper reductions, potentially affecting engineering teams and ongoing projects. Last year, Tan reportedly clashed with former CEO Pat Gelsinger over the scale of layoffs, advocating for more extensive cuts, a stance he appears to be implementing now. It remains uncertain whether Intel will offer voluntary buyouts or early retirement packages or resort to direct layoffs.
Details of the affected roles are yet to be disclosed. Intel, currently in its quiet period ahead of Thursday’s quarterly earnings report, has refrained from commenting on strategic changes.