Intel is preparing to lay off 20% of its employees – more than 20 thousand people

The US chipmaker is set to cut more than 20% of its workforce as early as this week. The large-scale layoffs will be part of a sweeping overhaul of the company under the leadership of a new CEO.

According to Bloomberg, in the coming days Intel will announce the largest layoffs in its history – the company plans to get rid of more than 20,000 jobs. The measures are designed to cut costs, simplify the management structure and return the company to its technical-engineering roots after a protracted recession.

The New Deal under Lip-Bu Tan

Global restructuring is being overseen by Intel’s new CEO Lip-Bu Tan, who took office just a month ago. He has set a course to remove bureaucratic barriers and optimize the management structure. The focus is on reducing duplicative positions, getting rid of redundant layers of management and returning focus to the company’s core products.

Sources say the current wave of layoffs is a logical continuation of last year’s restructuring phase, during which the company already parted with about 15,000 employees. At that time, administrative and auxiliary departments such as marketing, sales and internal services were mostly cut. The production chain and key engineering teams were virtually unaffected, as they are the ones Intel relies on as part of its strategy to develop its own contract chip production.

The cuts will affect all levels, but exact details have not yet been disclosed

At the end of December 2024, Intel had 108,900 employees, including workers at Altera, a recently spun-off company partly owned by Intel and investment firm Silver Lake. With that in mind, the planned layoff of more than 20,000 people means that even middle management will be affected by the cuts.

It’s not yet known whether the new wave of layoffs will affect engineering departments and ongoing projects. However, sources indicate that such a scenario is likely. Interestingly, Lip-Bu Tan previously left Intel’s board of directors because of disagreements with then-CEO Pat Gelsinger over the extent of the layoffs. Back then, Gelsinger suggested cutting 15,000 jobs, while Tan insisted on more drastic measures. Now, as head of the company, he has the opportunity to put his ideas into action.

It’s also unclear whether Intel plans to offer employees voluntary departures with compensation or whether the program will be implemented in the format of forced layoffs.

Announcement expected before quarterly earnings

The company is refraining from official comment until the release of its quarterly financial report, which is scheduled for next Thursday. Until then, Intel is in a “quiet period,” a time period during which publicly traded companies don’t make market-impacting announcements.