Intel is reportedly planning to lay off around 21,000 employees — roughly 20% of its workforce, according to Bloomberg. This news comes ahead of the Q1 earnings call led by the recently appointed CEO Lip-Bu Tan, who replaced longtime chief Pat Gelsinger last year. Tan aims to “streamline management and rebuild an engineering-driven culture,” with these layoffs. The company had around 108,900 employees at the end of last year after it announced 15,000 job cuts in August 2024.
Intel had previously said it would slash 15% of its workforce as it pursues the turnaround strategy of previous CEO Pat Gelsinger, who aimed to restore Intel’s lead in manufacturing chips. However, these plans did not spark confidence in the company’s board, who felt the turnaround strategy was not working and the progress of change was not fast enough. This led to Gelsinger’s ousting at the end of last year.
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The current layoffs come shortly after Tan planned an overhaul of the company’s manufacturing and AI operations, according to Reuters. The firm lost its lead in chipmaking to Taiwan’s TSMC and in recent years missed out on surging demand for AI processors, allowing competitors such as Nvidia to dominate those markets. Reuters also reported that Tan was flattening Intel’s leadership team, and appointed a new AI chief to head Intel’s artificial intelligence ambitions. However, the firm’s AI plans remain uncertain after it relegated its Falcon Shores chips to internal testing, leaving it without a competitive flagship in the AI market.
Intel’s stocks have also been dipping, having gone down by 67% over the past five years. Since he became CEO, Tan has moved to spin divisions of Intel into “non-core” units. Earlier this month, Intel sold 51% of its Altera semiconductor business to private equity firm Silver Lake.