Intel, the only U.S. manufacturer of large-scale advanced chips, is reportedly going to announce a drastic restructuring plan that will lay off more than 20 percent of its workforce. The decision comes after years of hardship and marks the first major maneuver under the leadership of new CEO Lip-Bu Tan, appointed last month to replace Pat Gelsinger.
The restructuring aims to simplify its corporate model, reduce internal bureaucracy, and revive a culture more focused on engineering and innovation, particularly in the field of artificial intelligence, where Intel has been steadily losing ground to competitors such as Nvidia. By the end of 2024, the company’s workforce had fallen to 108,900 employees, down from 124,800 in 2023, already affected by an earlier cut of about 15,000 positions as part of a $10 billion cost-cutting plan by 2025.
According to Reuters, Tan is currently reviewing operations related to manufacturing and artificial intelligence after Intel lost its lead in chip manufacturing to Taiwan’s TSMC. In a recent statement, the CEO said the company needs a more agile structure focused on engineering and AI to respond to increasing competitive pressure in the semiconductor industry.
As Yahoo Finance reports, former executives attribute Intel’s decline to a decade of poor strategic decisions, excessive staff growth, and management slowed by overly complex internal processes.
