Intel is planning a 20% cut of its 108,900-person workforce and will announce its intent to cut down its workforce this week, per a Bloomberg report released Tuesday. The move, which impacts over 21,000 roles, is Intel’s biggest round of layoffs yet and aims to reduce layers of bureaucracy, cut costs, and focus more on engineering roles.
The layoffs will also be the first major restructuring move under Intel’s new CEO, Lip-Bu Tan, who assumed the CEO role on March 18.
Tan, 65, is a chipmaking veteran and was formerly CEO of chip software company Cadence Design Systems from 2009 to 2021. He is now tasked with turning Intel around after three years of declining revenue amid increased competition from Nvidia and AMD.
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In a March memo to employees, Tan wrote that under his leadership, “Intel will be an engineering-focused company.”
“I’m confident we can turn our business around,” he wrote, adding, “We will push ourselves to develop the best products, listen intently to our customers, and hold ourselves accountable to the commitments we make so that we build trust.”
The move to cut staff comes months after another sweeping round of layoffs. In August, Intel announced plans to cut 15,000 employees after reporting a $1.6 billion net loss for the second quarter of 2024. The layoffs went into effect by the end of 2024. The chipmaker stated its intent in August to reduce costs by $10 billion in 2025 through layoffs, restructuring, and cost cuts.
Related: ‘Tough Day For All of Us:’ Intel CEO Announces Layoffs Affecting 15,000 People
Intel’s 2024 annual report shows that employee headcount was 108,900 in December 2024, down from 124,800 the year prior.
Intel has faced three years of declining revenue. Annual revenue went from $79 billion in 2021 to $63 billion in 2022 to $54 billion in 2023. According to Intel’s latest earnings report released in January, Intel’s annual revenue dropped further to $53.1 billion in 2024, a 2% year-over-year decline. Revenue for the fourth quarter of 2024 was $14.3 billion, down 7% year-over-year.
Intel has struggled to keep up with its competitors in the AI chip market, which Nvidia dominates with 70% to 95% market share. Intel announced its Xeon 6 AI chip in June 2024 and planned to announce a new Falcon Shores AI chip later this year. However, during its January earnings call, Intel disclosed that it was scrapping plans to release the Falcon Shores chip, opting instead to focus on data center solutions.
Intel stock has declined by about 65% over the past five years and by about 40% over the past 12 months at the time of writing. The company will report its first quarter 2025 earnings on Thursday.
