Intel Corp., a chipmaker, is set to cut more than 20% of its staff this week, representing over 21,000 employees.
A report by Bloomberg, citing a person with knowledge of the matter, said the move comes less than a year after Intel laid off 15,000 staff in a previous cost-cutting effort.
As of the end of 2024, Intel had 108,900 employees, already down sharply from 124,800 a year earlier.
The layoffs would be the first major restructuring under new Chief Executive Officer Lip-Bu Tan, who took the helm last month.
Tan, a former Cadence Design Systems boss, has made it clear that Intel needs a fresh start.
After years of lagging behind rivals like Nvidia in the AI chip race, the once-dominant tech giant is looking to reclaim its edge.
Just last week, Intel sold a 51% stake in its programmable chip unit, Altera, to private equity firm Silver Lake.
Tan has also flagged the need to rebuild lost engineering talent, revamp manufacturing processes, and put the company’s financials back on firmer footing.
The company is scheduled to report first-quarter results on Thursday, allowing Tan to lay out more of his strategy.
While some analysts believe the worst of the revenue decline is behind it, the road back to former glory remains long and uncertain. Wall Street isn’t projecting a full recovery any time soon.
The 65-year-old Tan took the helm following the exit of Pat Gelsinger, who had struggled to deliver on his ambitious turnaround plan.
Gelsinger had hoped to transform Intel into a major player in contract chip manufacturing similar to TSMC, but progress was slow, and timelines have now been pushed back. A planned mega-facility in Ohio is currently on ice, and prospects of a deeper partnership with TSMC seem to be fading.
In his first public appearance as CEO, Tan acknowledged the challenges ahead and cautioned that the turnaround won’t be quick or easy. Still, the cuts and strategy shifts signal that he’s willing to make bold moves to steer Intel back into relevance.
