Intel’s Massive Layoff Plan Signals Strategic Shake-Up Under New CEO

Intel is reportedly preparing to slash over 21,000 jobs—nearly 20% of its workforce—in a sweeping restructuring effort led by its new CEO, Lip-Bu Tan. The bold move underscores Intel’s struggle to regain its footing in the semiconductor space after years of market setbacks and sharp stock declines.

Intel is reportedly preparing to cut more than 21,000 jobs—roughly 20 percent of its global workforce—in a sweeping restructuring effort aimed at stabilizing the company after several tumultuous years. According to a Bloomberg report, the announcement could come as soon as this week, marking one of the largest rounds of layoffs the semiconductor giant has undertaken in its history.

The move comes at a pivotal moment for Intel, which has struggled to maintain its leadership position in the fiercely competitive chipmaking industry. Since 2020, Intel has watched its stock value plunge by nearly 67 percent, a reflection of missed product deadlines, execution challenges, and growing competition from rivals like AMD, NVIDIA, and Taiwan Semiconductor Manufacturing Company (TSMC). These financial pressures have been compounded by an accelerating global race for semiconductor dominance, where innovation speed and scale often determine market winners.

Steering the company through this restructuring is Intel's recently appointed CEO, Lip-Bu Tan, who replaced longtime chief Pat Gelsinger late last year. Tan, an industry veteran with a track record in venture capital and semiconductor investments, has wasted no time signaling his intent to transform Intel’s internal culture and operational strategy. His focus, as reported by Bloomberg, is to “streamline management and rebuild an engineering-driven culture,” a pointed critique of what some insiders have described as years of bureaucratic stagnation.

The scale of the layoffs reflects the depth of Tan’s ambition to reset Intel’s direction. This is not the first time the company has turned to job cuts to recalibrate. In August 2024, Intel announced 15,000 job losses as part of an earlier cost-cutting initiative. However, this latest move—set to surpass that figure by a wide margin—suggests that the new leadership sees fundamental restructuring as essential to the company’s future survival and competitiveness.

Part of this strategic overhaul includes shedding what Tan has categorized as "non-core" business divisions. Earlier this month, Intel finalized the sale of a controlling 51 percent stake in its Altera semiconductor division to private equity firm Silver Lake. The decision to offload Altera marks a clear pivot away from diversification toward a concentrated focus on Intel’s primary chipmaking operations. While such divestments may provide short-term financial relief and allow for reinvestment into core technologies, they also raise questions about the company’s ability to maintain broader market relevance across sectors like programmable logic and data center solutions.

Tan’s leadership philosophy emphasizes a return to Intel’s engineering roots—a culture that, in the company’s prime, was synonymous with innovation and market leadership. Over the past decade, however, multiple leadership transitions and strategic misfires have diluted that identity. The incoming CEO’s push to “streamline management” reflects a belief that the company’s top-heavy structure has hampered creativity and decision-making speed, factors critical in an industry where technological cycles move at a lightning pace.

Yet while cost-cutting and structural simplification might satisfy investors looking for decisive action, such dramatic workforce reductions carry significant risks. Losing experienced talent at scale could erode institutional knowledge and damage morale, making it harder for Intel to achieve the very engineering excellence Tan seeks to restore. Balancing this trade-off will be one of the leadership’s most delicate challenges in the months ahead.

The timing of the anticipated layoffs, coinciding with Intel’s upcoming Q1 earnings call, adds further weight to the announcement. Investor confidence has been shaky, and analysts will be scrutinizing both the earnings report and the restructuring plan for signs of whether Intel’s strategic reset is likely to succeed. The semiconductor sector is undergoing rapid transformation, with emerging demand in AI chips, automotive technology, and advanced data centers redefining competitive dynamics. Intel’s ability to retool its organization and refocus its innovation engine could determine whether it remains a central player in that evolving landscape or risks fading further behind.