American chipmaker Intel Corporation is set to cut more than 20% of its global workforce, affecting around 22,000 employees. The announcement, reported by Bloomberg, marks the company’s most significant restructuring in years and is part of a broader plan to rebuild its struggling business by streamlining management and returning to its engineering roots, as per the report.
Let’s break down why Intel is laying off thousands of employees, the implications of these layoffs, and what they signal about Intel’s future.
What’s driving Intel layoffs in 2025?
The latest round of job cuts is driven by Intel's desire to eliminate bureaucracy and regain operational agility. According to Reuters, Intel’s newly appointed CEO Lip-Bu Tan aims to cut down layers of middle management that have contributed to inefficiencies across the company’s sprawling structure.
Tan, who was previously CEO at Cadence and served on Intel’s board, has already warned employees of “tough decisions.” One of his primary goals is to reshape Intel’s AI and chip manufacturing strategies, two areas where the company has fallen drastically behind competitors like Nvidia and AMD.
Intel’s history of layoffs
Layoffs are not new for Intel. Under Pat Gelsinger, who served as the company’s CEO from 2021 to early 2025, the company underwent multiple rounds of job cuts. These actions were part of a cost-cutting strategy to reduce annual expenses by over $10 billion.
| Year | Employees Laid Off | % of Workforce |
| 2022 | 12,000 | Not specified |
| August 2024 | 15,000 | ~15% |
| 2025 | 22,000 | ~20% |
Source: Reuters, Bloomberg
While Gelsinger’s goal was to transform Intel into a contract chip manufacturing powerhouse, execution lagged, and competition surged ahead.
Intel’s struggles: Where it all began
Intel’s troubles didn’t start overnight. The company’s missteps began over a decade ago and worsened under successive CEOs. A pivotal moment was when Intel opted out of making chips for the iPhone back in 2007. Apple instead chose Arm Holdings-based chips, which now dominate the mobile processor space.
Then came more critical misses: delays in adopting EUV lithography, falling behind in advanced chip manufacturing, and the rise of AMD and Nvidia, which capitalized on both performance and AI computing needs.
Gelsinger’s initial hiring spree inflated the workforce by 10%, only to be followed by mass layoffs when performance didn’t keep pace with expectations.
Why is Intel restructuring?
There are several reasons why Intel is being forced into this major restructuring:
- Mounting Losses: Intel posted nearly $19 billion loss in 2024, its first annual loss since 1986.
- Lag in Innovation: Competitors adopted newer technologies faster. AMD embraced TSMC’s 7nm chips back in 2019 while Intel lagged until 2022-23.
- AI Missed Opportunity: Nvidia's dominance in AI chips, especially for data centers and large language models, left Intel playing catch-up.
- Manufacturing Failures: Reuters recently reported issues with Intel’s 18A chip manufacturing process, with Broadcom rejecting wafers due to sub-par results.
Together, these issues prompted CEOs to revamp Intel’s internal structure and cut operational fat.
Intel’s biggest misses over the years
Here's a snapshot of some strategic errors that have cost Intel dearly:
| Time Period | Misses |
| Early 2000s | Rejected Apple’s iPhone chip deal, Sold XScale Arm license |
| 2010s | Focused on multiple patterning over EUV, Ignored OpenAI investment |
| 2020s | Lost Apple Mac chips business, Blocked Tower Semiconductor acquisition, Delays in 18A process |
Intel’s stock and financial picture
Intel has been one of the most beaten-down tech US stocks over the last two decades. Its market capitalization has plummeted by a staggering 82%, falling from $502.7 billion in 2000, when it was one of the most valuable companies in the world, to just $89.78 billion in April 2025, according to CompaniesMarketCap data.
That’s a loss of nearly $413 billion in shareholder value, equivalent to More than the combined current market cap of IBM and American Express combined.
Intel is expected to post a bleak Q1 2025. As per Bloomberg estimates:
- Expected Q1 Revenue: $12.3 billion, down from $12.7 billion YoY
- Expected EPS: $0.01, down from $0.18 YoY
- Client Computing Revenue: $6.9 billion (vs. $7.5B in Q1 2024)
- AI & Data Center Revenue: $2.9 billion (vs. $3.0B)
- Foundry Revenue: $4.3 billion (vs. $4.36B)
In Q4 2024, Intel posted a net loss of $126 million, compared to a profit of $2.67 billion the year before. Even its new AI-focused products like Gaudi 3 haven't generated enough traction, falling short of a $500 million revenue goal, according to the earnings report.
Challenges ahead for Intel
Intel’s challenges aren’t just about competition. They're systemic:
- Execution delays
- Missed market transitions
- Over-reliance on legacy revenue streams
- Weak traction in AI despite new product launches
Is there light at the end of the tunnel for Intel?
Intel’s massive layoffs are not just cost-cutting measures, they’re a reckoning. Years of missed opportunities, poor strategic decisions, and strong competition have forced Intel into survival mode.
Even though Tan has committed to simplifying the organization structure and empowering engineers, analysts caution that without timely product launches and successful manufacturing upgrades, Intel could continue to fall behind.
As Intel prepares to report Q1 earnings on April 24, investors, employees, and tech watchers alike will be watching closely to see if the once-dominant chipmaker can finally turn the corner.
Disclaimer:
The content is meant for education and general information purposes only. Investments in the securities market are subject to market risks, read all the related documents carefully before investing. Past performance is not indicative of future returns. The securities are quoted as an example and not as a recommendation. This in no way is to be construed as financial advice or a recommendation to invest in any specific stock or financial instrument. The Company strongly encourages its users/viewers to conduct their own research, and consult with a registered financial advisor before making any investment decisions. All disputes in relation to the content would not have access to an exchange investor redressal forum or arbitration mechanism. INDmoney Global (IFSC) Private Limited, Unit No. GA-02, Seat No. 1-4, Ground Floor, Pragya Accelerator Block-15 T, Road 11, Zone-1, Processing Area, GIFT SEZ, Gift City, Gandhinagar, Gujarat, India, 382355 IFSCA Broker-Dealer Registration No. IFSC/BD/2023-24/0016, IFSCA DP Reg No: IFSC/DP/2023-24/010.