Intel has announced further job cuts and the cancellation of several projects in Europe as part of chief executive officer Lip-Bu Tan’s efforts to revive the company’s fortunes.
The chipmaker plans to reduce its core workforce to 75,000 by the end of 2025, down from 99,500 at the end of last year, through layoffs and attrition. This reduction represents more than 20 per cent of the company’s workforce.
In a memo to employees, Tan wrote, “I know the past few months have not been easy. We are making hard but necessary decisions to streamline the organisation, drive greater efficiency and increase accountability at every level of the company.” He also stated, “There are no more blank checks. Every investment must make economic sense.”
Intel will halt previously planned projects in Germany and Poland and will consolidate assembly and test operations in Costa Rica to larger facilities in Vietnam and Malaysia. The company is also slowing the construction of its semiconductor plant in Ohio.
The restructuring comes as Intel continues to face stiff competition from rivals such as Nvidia and Advanced Micro Devices, particularly in the artificial intelligence chip market. For the second quarter, Intel reported a net loss of $2.9 billion, or 67 cents per share, compared with a loss of $1.6 billion, or 38 cents per share, a year earlier. Revenue remained flat at $12.9 billion.
Tan emphasised that Intel is focusing on its “core product portfolio” and artificial intelligence offerings to better serve customers. The company’s market capitalisation stood at $98.71 billion as of Thursday, significantly lower than Nvidia’s $4.24 trillion.
The staff reductions and project cancellations are part of a broader strategy to improve efficiency and return the company to profitability, as Intel seeks to regain its competitive edge in the global semiconductor market.
