Intel to cut 20% of staff as changes come to company

The power of Intel Inside sounds like a big plus—until you’re on the outside.

A big shakeup is coming to one of the tech industry’s major players, as Intel plans to cut over 20% of its staff. The layoffs, framed as “restructuring” under new CEO Lip-Bu Tan, are expected to be announced this week, according to Bloomberg. Sources told the paper that the reductions are in service of efforts to “streamline management and rebuild an engineering-driven culture.” Intel did not return a request for comment by press time.

Flashback. That’s a marked difference from how former CEO Pat Gelsinger framed similar job cuts last August. Those reductions, 15% of the workforce at the time—ultimately, about 15,000 workers—were positioned as a regrettable response to slowing sales and a series of poor business decisions.

“Simply put, we must align our cost structure with our new operating model and fundamentally change the way we operate,” Gelsinger said at the time. “Our revenues have not grown as expected—and we’ve yet to fully benefit from powerful trends.”

Those changes didn’t pay off for the beleaguered executive, who stepped down in December after being removed by the company board. It took until March for Tan to replace Gelsinger; in the interim, David Zinsner and Michelle Johnston Holthaus served as co-CEOs.

Moving forward. In a letter to staff Mar. 12, Tan said that under his leadership the company would be willing to make hard decisions to “extend our advantage” and “take calculated risks.”

“And in areas where our progress has been slower than expected, we need to find new ways to pick up the pace,” Tan wrote.

The new cuts appear to be part of a wider effort. A memo sent to employees on Apr. 17 announced a shuffle in responsibilities for newly appointed CTO and AI Chief Sachin Katti, who will lead AI strategy; meanwhile, the former data center and AI group is being split to focus on data center CPUs and GPUs, respectively.