Intel Plans 25,000 Job Cuts as New CEO Resets Strategy

Intel (NASDAQ: INTC) is launching a sweeping restructuring plan that will eliminate around 25,000 jobs, scale back global fabrication projects, and refocus operations under new CEO Lip-Bu Tan. The cost-cutting drive aims to reverse sustained losses and stabilize the chipmaker’s competitiveness.

Strategic Overhaul Targets Global Reductions

Announced alongside second-quarter results, Intel’s reset includes reducing its workforce from nearly 100,000 at the end of 2024 to approximately 75,000 by year-end 2025—a cut of roughly 15–20%. Projects scrapped include chip fabrication facilities in Germany and Poland, while assembly operations in Costa Rica will be consolidated into sites in Malaysia and Vietnam.

Tan, appointed to course-correct Intel’s stalled foundry strategy, emphasized eliminating “blank check” spending and tying future investment to firm customer demand. The 18A process node remains a priority, but further builds will depend on securing pre-committed commercial volume.

Financial Results and Immediate Market Reaction

Intel posted second-quarter revenue of $12.9 billion, slightly above expectations. However, restructuring charges led to a net loss of $441 million. The company warned of a deeper loss in the third quarter, triggering a 6% decline in its share price in after-hours trading.

Intel’s prior ambitions to build a global foundry business have faltered amid weak external demand. The pivot away from speculative infrastructure—particularly in Europe—is intended to preserve capital and refocus on Intel’s internal x86 platform, including next-gen Panther Lake and Granite Rapids chip lines.

Operational Cuts and Organizational Shifts

Earlier in 2025, Intel had already shed around 22,000 roles, including 5,000 across U.S. operations in July. The latest cuts will impact its automotive chip businesses in Germany and Poland, and affect up to 195 positions at the company’s Leixlip site in Ireland. Mid-level management ranks are being compressed to flatten decision-making layers and reduce operating drag.

The company is also enforcing a return-to-office mandate effective September 2025. Tan cited improved team coordination and operational accountability as key motivations for bringing staff back onsite during the restructuring phase.

Strategic Risks and Competitive Landscape

The retrenchment raises questions about the viability of Intel’s $100 billion in foundry-related commitments. Without large-scale external contracts, some analysts believe Intel’s manufacturing ambitions could face further deferral or scaling back.

By narrowing its focus to core businesses—consumer and enterprise CPUs, data center chips, and process efficiency—Intel hopes to regain profitability. However, competitors such as AMD, Nvidia, TSMC, and Microsoft Azure remain well-positioned to capture market share if Intel stumbles.

Tips for Traders

• Track Intel (NASDAQ: INTC) shares closely for pricing sensitivity as restructuring details emerge and Q3 forecasts firm up.

• Watch sector peers—particularly AMD and Nvidia—for signs of market rotation or capital shift as Intel exits certain segments.

• Monitor CDS spreads and options activity in semiconductor names for forward signals on perceived risk across the space.

• Evaluate Intel’s margin guidance tied to cost savings and RTO implementation—execution will determine credibility.

• Keep an eye on 18A node progress and roadmap updates; delays or design flaws could reset recovery timelines.