Intel Takes Drastic Measures to Revive Struggling Business

Intel announces drastic measures to fix its struggling business, including laying off employees and reducing its workforce by 15% by the end of the year. The company's revenue remained flat YoY and suffered a net income loss of $2.9 billion in Q2. CEO Lip-Bu Tan said the company will focus on strengthening its core product portfolio and AI roadmap, and building a more financially disciplined foundry.

Title: Intel Announces Drastic Measures to Address Business Struggles

Intel (INTC) has taken significant steps to address its struggling business, including a substantial reduction in its workforce and strategic changes aimed at bolstering its financial health. The company has announced that it will reduce its workforce by 15% by the end of the year, which translates to approximately 24,000 employees [1]. This decision is part of a broader strategy to streamline operations and reset the company's financial and operational foundation in the face of stiff competition in the semiconductor market.

Intel's Chief Financial Officer, Dave Zinser, emphasized that more reductions are expected through natural attrition and restructuring, including the ongoing reorganization of business units. The company has already completed the majority of its planned headcount reductions, which primarily affected its core workforce. As of the end of 2024, Intel had 109,800 employees, with 99,500 classified as core staff. The company now plans to shrink that number significantly, targeting around 75,000 core employees by the end of 2025—a reduction of over 24,000 roles from its earlier levels [1].

In addition to workforce reductions, Intel has announced a series of cutbacks as part of its broader cost-reduction strategy. The company will pull out of planned projects in Germany and Poland and shut down its assembly and testing operations in Costa Rica. The delay in the completion of its $28 billion chip manufacturing facility in Ohio is another significant change. Originally slated for completion by the end of 2025, the plant is now expected to be finished closer to the end of 2030, with Intel citing the need to "ensure that spending is aligned with demand" [1].

CEO Lip-Bu Tan, who took the reins in March, expressed cautious optimism about Intel’s path forward during the latest earnings call. He acknowledged that while the turnaround would take time, there are clear opportunities to strengthen Intel’s competitiveness, boost profitability, and deliver long-term value to shareholders. Tan criticized the company’s previous approach of building capacity ahead of demand, stating that under his leadership, Intel will build what customers need, when they need it, and earn their trust [1].

Intel's recent earnings report highlighted the company's multiple challenges. Revenue remained flat year-over-year (YoY) in Q2, and the company suffered a net income loss of $2.9 billion. These financial struggles have led some investors to question Intel's future prospects. However, CEO Tan has outlined a clear strategy to refocus the business on core priorities such as AI, its x86 CPU franchise, and the launch of a foundry for its 18A process. Some investors continue to bet on Intel's eventual turnaround, but the latest report suggests that it may take longer than initially anticipated [2].

In the meantime, tech giants like AMD and TSMC are capitalizing on Intel's struggles. Advanced Micro Devices (AMD) has emerged as a winner, grabbing market share from Intel in the PC-focused client segment. TSMC, Intel's primary competitor in the foundry business, continues to post blistering growth, with revenue growth of 44.4% in Q2 and profits soaring by 60.1% [2].

References
[1] https://in.mashable.com/tech/97568/intel-workforce-reduction-grows-to-25000-amid-turnaround-efforts
[2] https://www.fool.com/investing/2025/07/30/should-you-forget-intel-and-buy-these-2-tech/