Intel is preparing to make significant layoffs as it intends to reduce its workforce by 15% and end the year with about 75,000 workers worldwide. The move is part of a broader plan led by new CEO Lip-Bu Tan, aimed at resetting the company’s direction and streamlining operations.
“There are no more blank checks,” Tan wrote in a memo to employees. “Every investment must make economic sense. We will build what our customers need, when they need it, and earn their trust through consistent execution.”
READ: Scale AI announces 14% layoffs following Meta investment (
As part of his larger effort to turn things around at the prominent American chipmaker since taking over in March, CEO Tan already finished a significant wave of layoffs in Q2. Intel has been shifting its focus, letting go of employees, and selling off parts of the business to stay on course.
The company has either scrapped or put major factory plans on hold in Germany, Poland, and Costa Rica, choosing instead to focus and streamline its operations in Vietnam and Malaysia.
Tan, a former board member and longtime venture investor, has made it clear he’s focused on cutting red tape and driving efficiency since he took over the CEO role earlier this year. He’s personally going through all major chip design and manufacturing investments, pushing for more clarity and tighter control company-wide.
In the latest Q2 report, Tan laid out four key focus areas: company culture, foundry strategy, the x86 business, and AI. He’s driving a full-scale organizational review, aiming to cut management layers in half. He’s also rolling out a return-to-office mandate starting September, saying it’s part of a broader push to move faster and work smarter. He revealed, “our top priority is delivering our first Panther Lake SKU by year-end.”
READ: Incoming Intel CEO to revive the chipmaker with new AI strategies (March
“Second quarter revenue was $12.9 billion, coming in above the high end of our guidance range,” and explained the impact of one-time impairment and restructuring costs on gross margin and EPS. “Q2 gross margin was 29.7% and EPS of minus $0.10. Excluding these charges, our second quarter non-GAAP gross margin would have been 37.5% and non-GAAP EPS would have been $0.10, both results ahead of our Q2 guidance,” CFO David Zinsner reported.
On the AI front, Tan acknowledged they fell short in the past, saying the company had taken a more old-school, silicon-first approach that lacked a unified software and systems strategy. Now, he says the focus is shifting toward building a full-stack AI platform with a strong push into inference and emerging agentic AI models.
Looking ahead, the company expects to spend around $18 billion in gross capital expenditures for 2025, with net spending likely to fall between $8 billion and $11 billion. That number is set to come down further in 2026 as they tighten costs and focus on more selective investments.