Intel plans to lay off up to a fifth of its factory workforce. This round of layoffs comes on top of earlier restructurings.
Intel is going to lay off fifteen to twenty percent of its Foundry division’s workforce. This is evident from an internal email that the American newspaper The Oregonian was able to review.
Chip manufacturing is a crucial part of Intel’s capabilities. The fact that Intel no longer produces the most technologically advanced CPUs on the market is due to a delay in innovation in that domain. TSMC was able to take the lead, benefiting TSMC customers and Intel competitors such as AMD. It is therefore surprising that Intel wants to cut heavily in the factory division.
Less Complexity
The chip maker says it wants to remove organizational complexity and give engineers the ability to better meet customer needs. Intel describes the plans as difficult but necessary to ensure affordability in light of the company’s current financial position.
The layoffs are scheduled for next month. Officially, Intel has not yet commented. The company employs about 109,000 people worldwide, but it’s unclear how many of them are linked to the Foundry division.
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Intel has already undergone several major rounds of layoffs. In 2024, 15,000 employees had to leave, and two years before that, the company restructured as well.
Intel has been trying to find a fresh start for several years. Since March, this has been happening under the leadership of CEO Lip-Bu Tan, who is taking over the task from the suddenly dismissed Pat Gelsinger. Gelsinger, in turn, had the mission to pull Intel out of its negative spiral and took major steps to do so, such as splitting off the Foundry division, but all of this wasn’t fast enough for the board of directors.