Intel, the semiconductor giant, is reportedly preparing to announce substantial workforce reductions exceeding 20,000 positions this week, representing more than 20% of its global workforce, according to Bloomberg.
The massive layoffs are part of a revival strategy led by newly appointed CEO Lip-Bu Tan, who aims to streamline operations and restore the company's engineering-focused culture. This follows a previous round of cuts in August 2024 that affected approximately 15,000 employees.
Intel employed 108,900 people globally as of December 2024. The planned cuts would mark one of the largest workforce reductions in the company's history, potentially affecting operations across multiple locations, including its major hub in Oregon where 20,000 people are currently employed.
The chipmaker has faced mounting challenges in recent years, including:
- A roughly 33% decline in sales since 2021
- A $19 billion loss recorded last year
- Technological setbacks causing Intel to lose its market leadership
- Growing competition in the artificial intelligence chip sector
- Potential impacts from international trade tensions
Industry analysts suggest these cuts may extend beyond cost savings, reflecting Tan's broader vision to eliminate bureaucracy and excessive management layers. Before becoming CEO, Tan reportedly disagreed with his predecessor's more modest reduction plans, advocating for deeper organizational changes.
The timing of the announcement coincides with Intel's quarterly earnings report scheduled for Thursday, followed by an all-hands meeting with employees on Friday morning. The company has declined to comment on the reported cuts during its quiet period before the earnings announcement.
Details remain unclear regarding which departments will be affected and whether the company will offer voluntary separation packages or proceed with direct layoffs. The impact on engineering teams, which were largely protected in previous cuts, remains to be seen.