Intel to announce plans this week to cut more than 20% of staff

[XYang2023]

The layoffs would be the first major restructuring under new CEO Tan Lip-Bu, who took the helm in March.PHOTO: REUTERS

UPDATED Apr 23, 2025, 09:45 AM

TAIPEI – Intel is poised to announce plans this week to cut more than 20 per cent of its staff, aiming to eliminate bureaucracy at the struggling chipmaker, according to a person with knowledge of the matter.

The move is part of a bid to streamline management and rebuild an engineering-driven culture, according to the person, who asked not to be identified because the plans are private. It would be the first major restructuring under new chief executive officer Tan Lip-Bu, who took the helm in March.

The cutbacks follow an effort in 2024 to slash about 15,000 jobs – a round of layoffs announced in August. Intel had 108,900 employees at the end of 2024, down from 124,800 the previous year.

A representative for Intel declined to comment.

Mr Tan is aiming to turn around the iconic chipmaker after years of Intel ceding ground to rivals. The US chip giant lost its technological edge and has struggled to catch up with Nvidia in artificial intelligence computing. That contributed to three straight years of sales declines and mounting red ink.

Mr Tan, a veteran of Cadence Design Systems, has vowed to spin off Intel assets that aren’t central to its mission and create more compelling products. Last week, the company agreed to sell a 51 per cent stake in its programmable chips unit Altera to Silver Lake Management, a step towards that goal.

Intel needs to replace the engineering talent it has lost, improve its balance sheet and better attune manufacturing processes to the needs of potential customers, Mr Tan said in March at the Intel Vision conference.

Intel to announce plans this week to cut more than 20% of staff

Layoffs would be the first major restructuring under new CEO Tan Lip-Bu, who took the helm in March. Read more at straitstimes.com. Read more at straitstimes.com.

www.straitstimes.com

 

[Artificer60]

This will result in a RIF of over 40% when combined with the last round of layoffs. IMHO cuts this deep will do more damage to morale than any gains they might make, unless Tan can clearly show they are aimed at reducing management and he is making engineers lives better. The engineering staff already took a serious hit in the last round of layoffs. Many of them their most experience engineers leaving though voluntary severance.

 

[XYang2023]

I think definitely they will focus on middle management and maybe sales and some software developers. I think at the same time they will hire engineers to work on GPUs.

We also know gen AI can do well in coding and related tasks. It makes sense to copy similar actions in Microsoft, Google and Meta.

If cost per role is around 200k, that would be 4B annual saving.

 

[XYang2023]

Microsoft mulls more job cuts, this time focused on managers and non-coders, not just low performers, sources say

Inside Microsoft, some leaders eye "span of control," or the number of staff who report to each manager. They want more coders versus non-coders, too.

www.businessinsider.com

 

[dkr1986]

Lip Bu Tan is splitting the DCAI group to Datacenter group & AI group. DC group will only focus on DC CPUs under Karin Eibschitz. AI group will be led by the new CTO, Sachin Katti, will focus on AI accelerators for DC. It looks like NEX & all groups under previous CTO will also be led by Sachin.

As Intel Creates New AI Group, Data Center Division To ‘Refocus’ On CPUs: Memos

With Intel’s new CTO and AI chief taking over responsibilities for the company’s AI road map and strategy, the business unit most recently known as the Data Center and AI Group will “refocus” on CPUs and take on an older name, according to two internal memos seen by CRN.

www.crn.com

 

[XYang2023]

Lip Bu Tan is splitting the DCAI group to Datacenter group & AI group. DC group will only focus on DC CPUs under Karin Eibschitz. AI group will be led by the new CTO, Sachin Katti, will focus on AI accelerators for DC. It looks like NEX & all groups under previous CTO will also be led by Sachin.

As Intel Creates New AI Group, Data Center Division To ‘Refocus’ On CPUs: Memos

With Intel’s new CTO and AI chief taking over responsibilities for the company’s AI road map and strategy, the business unit most recently known as the Data Center and AI Group will “refocus” on CPUs and take on an older name, according to two internal memos seen by CRN.

www.crn.com

It is reverting back to "AXG".

 

[psantodomingo]

This will result in a RIF of over 40% when combined with the last round of layoffs. IMHO cuts this deep will do more damage to morale than any gains they might make, unless Tan can clearly show they are aimed at reducing management and he is making engineers lives better. The engineering staff already took a serious hit in the last round of layoffs. Many of them their most experience engineers leaving though voluntary severance.

Hard to see how cutting workforce will make engineers let alone anyone’s lives better at intel. Maybe less workload for the janitorial staff

 

[Daniel Nenni]

That sure is one leaky ship. I'm surprised Reuters did not leak this one first. They are such a credible source.

 

[Barnsley]

This will result in a RIF of over 40% when combined with the last round of layoffs. IMHO cuts this deep will do more damage to morale than any gains they might make, unless Tan can clearly show they are aimed at reducing management and he is making engineers lives better. The engineering staff already took a serious hit in the last round of layoffs. Many of them their most experience engineers leaving though voluntary severance.

Its all about shareholder value.

Staff unhappy so what!

I thought this is the US way of doing business

 

[siliconbruh999]

Can this include staff from Altera their Nand business and Dalian Fab both of which should be closing now?

 

[fansink]

Its all about shareholder value.

Staff unhappy so what!

I thought this is the US way of doing business

Exactly, a bunch of bleeding hearts, need to suck it up.

Intel is not a spa, trim to the bone, prepare for Lip-Bu Tan's Intel 6.0 (or 7.0 ... I lost count).

Regardless of what Tan says in public, mostly politically focused at Trump and his wet-dreams of chip supremacy, Tan leans fabless, favoring design efficiency over Gelsinger’s fab-heavy strategy, aligning with Apple, AMD, and Nvidia trends.

Tan’s history at Cadence and investments in design-focused firms suggest preference for fabless model’s flexibility, cost-efficiency.

Don't forget, Gelsinger fired Tan from Intel's board, reportedly over strategic disagreements (Fab vs Fabless).

As of the latest cuts:

Revenue per Employee
Intel ~$570,000
Qualcomm ~$870,000
AMD ~$1,200,000
TSMC ~$1,270,000
Nvidia ~$1,420,000
Apple ~$2,400,000

 

[soAsian]

Pat did the same thing

Intel CEO Pat Gelsinger says 15,000 job cut is painful but necessary for 'a new era of growth'. Read full letter here

Intel Layoffs: Intel revealed plans to reduce its workforce by 15%, translating to approximately 15,000 roles, to manage costs better. CEO Pat Gelsinger emphasized the need for the company to align its cost structure with its new operating model. Enhanced retirement offerings and voluntary...

economictimes.indiatimes.com

lets hope Tan didn't get layoff by Intel like Pat. Layoff seem to be the play book of every CEO.

 

[dkr1986]

Don't forget, Gelsinger fired Tan from Intel's board, reportedly over strategic disagreements (Fab vs Fabless).

I don't think this was the disagreement between Gelsinger & Tan (fab vs fabless). News reported that Tan wanted deeper cuts to the workforce and more focus on AI. The news so far about his actions seems to align with that. We will know more in future.

The fact is except for people who are worried about the future of Taiwan' silicon shield & TSMC, no one wants Intel to abandon the foundry efforts. More importantly, US government definitely does not want that as well.

EDIT - may be some short-term thinking $INTC investors (who are probably holding a bag) do.

 

[fansink]

I don't think this was the disagreement between Gelsinger & Tan (fab vs fabless). News reported that Tan wanted deeper cuts to the workforce and more focus on AI. The news so far about his actions seems to align with that. We will know more in future.

The fact is except for people who are worried about the future of Taiwan' silicon shield & TSMC, no one wants Intel to abandon the foundry efforts. More importantly, US government definitely does not want that as well.

Not to worry, TSMC is coming to the rescue; the preferred foundry by ~98% of leading fabless companies, even at -2N.

 

[Daniel Nenni]

Exactly, a bunch of bleeding hearts, need to suck it up.

Intel is not a spa, trim to the bone, prepare for Lip-Bu Tan's Intel 6.0 (or 7.0 ... I lost count).

Regardless of what Tan says in public, mostly politically focused at Trump and his wet-dreams of chip supremacy, Tan leans fabless, favoring design efficiency over Gelsinger’s fab-heavy strategy, aligning with Apple, AMD, and Nvidia trends.

Tan’s history at Cadence and investments in design-focused firms suggest preference for fabless model’s flexibility, cost-efficiency.

Don't forget, Gelsinger fired Tan from Intel's board, reportedly over strategic disagreements (Fab vs Fabless).

My understanding was that Lip-Bu did not agree with Pat's 15% cut. Lip-Bu wanted deeper cuts. Based on the latest rumors that seems to hold weight. Lip-Bu has said publicly that he supports the manufacturing side of Intel. We will know more at the Intel Foundry event next week.

 

[blueone]

Lip Bu Tan is splitting the DCAI group to Datacenter group & AI group. DC group will only focus on DC CPUs under Karin Eibschitz. AI group will be led by the new CTO, Sachin Katti, will focus on AI accelerators for DC. It looks like NEX & all groups under previous CTO will also be led by Sachin.

As Intel Creates New AI Group, Data Center Division To ‘Refocus’ On CPUs: Memos

With Intel’s new CTO and AI chief taking over responsibilities for the company’s AI road map and strategy, the business unit most recently known as the Data Center and AI Group will “refocus” on CPUs and take on an older name, according to two internal memos seen by CRN.

www.crn.com

I'm not enthused about any of these announcements. Katti has not impressed me at all. The Network and Edge Group he led previously did not demonstrate much in the way of product leadership or marketshare growth. Katti is also another one of these executives who still is listed by Intel as a professor at Stanford University. And he's the co-chair of the Technical Steering Committee for the O-RAN Alliance. Seriously? How does a person be effective as a corporate CTO, AI Chief, a Stanford professor, and have a technical leadership role for an industry specification group simultaneously? Intel has appointed these professor multi-tasking types before, as with Nick McKeown in networking and Amnon Shashua in Mobileye. Neither case turned out well. Whatever the announcement says, I doubt Katti will have much in the way of focus at all.

 

[siliconbruh999]

I'm not enthused about any of these announcements. Katti has not impressed me at all. The Network and Edge Group he led previously did not demonstrate much in the way of product leadership or marketshare growth. Katti is also another one of these executives who still is listed by Intel as a professor at Stanford University. And he's the co-chair of the Technical Steering Committee for the O-RAN Alliance. Seriously? How does a person be effective as a corporate CTO, AI Chief, a Stanford professor, and have a technical leadership role for an industry specification group simultaneously? Intel has appointed these professor multi-tasking types before, as with Nick McKeown in networking and Amnon Shashua in Mobileye. Neither case turned out well. Whatever the announcement says, I doubt Katti will have much in the way of focus at all.

same i don't like these changes either they need some external hire a good one

 

[MKWVentures]

The good thing is that Tan is looking to make a new Intel. Not a "we will bring back the 90s" Intel (This is not 1995, move on). Intel has very smart people and has a lot of ideas. Just need to stop prioritizing the areas where Intel is not effective or efficient. Side note: He will hire new people even while laying off people. That is how to get to the new Intel.

 

[blueone]

The good thing is that Tan is looking to make a new Intel. Not a "we will bring back the 90s" Intel (This is not 1995, move on). Intel has very smart people and has a lot of ideas. Just need to stop prioritizing the areas where Intel is not effective or efficient. Side note: He will hire new people even while laying off people. That is how to get to the new Intel.

I'm still looking for a good thing. So far I just see a few different things, none of which are impressing me much.

 

[MKWVentures]

I'm still looking for a good thing. So far I just see a few different things, none of which are impressing me much.

fair enough. He is benchmarking Intel vs other companies and Intel needs big changes to even get close. Rumor is that he thinks correct headcount is 60-70K so this might be just a start. Many will be sell offs, not layoffs though..... be patient