In a move set to reshape the global semiconductor landscape, Intel Corporation will lay off between 15% and 20% of its Intel Foundry division workforce beginning July 2025. The reduction impacting more than 10,000 employees worldwide marks one of the most severe rounds of job cuts in Intel’s history and signals a significant shift in how the company intends to operate amid financial and strategic headwinds.
The cuts are part of a broader restructuring effort spearheaded by Intel’s new CEO, Lip-Bu Tan, who assumed leadership in March 2025. These layoffs follow two earlier rounds in the past year, bringing total job eliminations to over 35,000 positions since August 2024.
“Difficult But Essential,” Says Manufacturing VP
In an internal memo sent over the weekend and reviewed by The Oregonian, Naga Chandrasekaran, Intel’s Vice President of Manufacturing, acknowledged the emotional toll of the impending layoffs.
“These are difficult actions but essential to meet our affordability challenges and current financial position of the company. It drives pain to every individual,” Chandrasekaran wrote.
The memo highlighted that the layoffs will span across 15 wafer fabrication plants in 10 global locations, impacting a wide range of positions from cleanroom floor technicians and material handlers to senior R&D engineers working on next-generation microprocessors.
No Severance Packages Offered
In a stark departure from past precedent, no severance packages or voluntary buyouts will be offered to affected employees. Instead, Intel will make decisions based on a combination of performance evaluations, skill assessments, strategic portfolio adjustments, and project prioritization.
“These reductions will be based on a combination of portfolio changes, level and position elimination, skill assessment for remaining positions, and some hard decisions around our project investments,” Chandrasekaran noted. “We are also taking into consideration factory operations impact.”
By eliminating voluntary departure incentives, Intel is signaling a more aggressive cost-cutting strategy, prioritizing operational efficiency over employee sentiment.
A Major Step in CEO Tan’s Restructuring Plan
These layoffs are central to CEO Lip-Bu Tan’s broader strategy to reimagine Intel’s corporate structure and restore its engineering leadership. Since taking the reins in March, Tan has openly criticized the company’s layers of bureaucracy and its sluggish response to technological shifts especially in AI and high-performance computing.
“I’m a big believer in the philosophy that the best leaders get the most done with the fewest people,” Tan wrote in a company-wide memo in April.
Tan’s vision includes slashing more than 20% of Intel’s total workforce, restructuring business units, reducing management layers, and refocusing investment on Intel’s core semiconductor engineering and manufacturing capabilities.
Intel’s headcount has already declined from 125,000 employees in 2023 to roughly 109,000 by the end of 2024, and these upcoming cuts will likely reduce that number even further, to below 95,000.
The July 2025 cuts represent Intel’s third major layoff round in under a year. The first, under former CEO Pat Gelsinger, came in August 2024, when the company slashed 15,000 jobs and implemented a $10 billion cost-cutting initiative. That wave was accompanied by early retirement incentives and voluntary buyouts options now absent under Tan’s more austere approach.
Earlier in March 2025, another round of layoffs further reduced Intel’s global footprint. This third and largest round intensifies Tan’s efforts to transform Intel into a leaner, faster-moving company that can better compete in a rapidly evolving industry dominated by Nvidia, AMD, and TSMC.
The layoffs come at a turbulent time for Intel. The company reported an $821 million net loss in Q1 2025, reflecting continued challenges in its core PC and data center markets. While rivals like Nvidia have seen surging growth thanks to demand for AI chips, Intel has struggled to stake its claim in the artificial intelligence boom.
Complicating matters is the delay in funding from the U.S. CHIPS and Science Act, which has so far failed to deliver the $7.9 billion subsidy Intel was promised for domestic chip manufacturing. With the Trump administration re-evaluating award allocations, Intel’s future in U.S.-based chip fabrication remains uncertain.
Not all employees will face the axe. The memo confirmed that key technical roles, such as process engineers, equipment technicians, and lithography specialists working on Intel’s most advanced nodes, will largely be protected. These roles are critical to Intel’s long-term roadmap, especially as it seeks to close the technology gap with TSMC and Samsung.
However, positions made redundant by automation, as well as roles in bloated management tiers or overlapping administrative functions, are expected to be heavily impacted.
Intel’s decision to proceed with the largest job cut in its recent history with no severance, no voluntary exits, and a performance-based selection model underscores the urgency of its current transformation. As competitors seize market share and global supply chains shift, Intel is betting that tough decisions today will fuel a more agile and competitive tomorrow.
But with thousands of livelihoods in the balance and investor confidence wavering, only time will tell if this high-stakes gamble pays off.
