Intel has announced a new round of layoffs within its data center business group, continuing a significant downsizing trend observed over the past two years.
According to a report on the 20th, the company has notified employees in its data center division that positions will be eliminated, though the specific number of affected jobs was not disclosed. In a statement, Intel indicated this restructuring is part of its broader strategy to become a "more focused and efficient company," designed to ensure the business has the "right roles and skills in place." The company stated the move does not impact its product commitments or technology roadmap.
This news of staff reductions comes just ahead of Intel's scheduled release of its second-quarter financial results. In the first quarter of this year, the Data Center and AI segment reported sales of $5.1 billion, marking a 22% increase year-over-year. Concurrently, Intel's stock price has surged over the past year from around $23 to approximately $99 in early Monday trading, as investors hold high expectations for the prospects of its AI chip demand and the expansion of its foundry operations.
Organizational Streamlining Amid Business Improvement
This latest round of cuts at Intel coincides with a period of notable business recovery. Investors anticipate that demand for Intel's microprocessors will continue to grow as AI systems take on more online tasks. Furthermore, there is widespread market expectation that major technology firms like Apple may contract Intel to manufacture chips, providing new growth for its foundry business.
Intel's share price has risen more than 300% over the past year, briefly surpassing $142 last month before retreating somewhat. However, this strong stock performance has not deterred management from continuing to advance organizational efficiency reforms.
CEO Pat Gelsinger has clearly stated that Intel needs to reduce management layers to accelerate decision-making and enable faster deployment of new technologies.
Employee Count Shrinks by Over 40,000 in Four Years
The job cuts in the data center unit represent a continuation of Intel's substantial, ongoing workforce reduction efforts in recent years. Since 2022, Intel's global employee headcount has decreased from approximately 132,000 to about 81,000 currently—a reduction nearing 40%.
This reduction in positions has been achieved through two primary avenues: the divestiture of certain business units and the direct elimination of tens of thousands of jobs worldwide over the past two years.
In Oregon, Intel remains the state's largest corporate employer, but its local workforce has also seen a significant decline, dropping from roughly 23,000 employees in 2024 to about 16,000 currently.
Intel's persistent downsizing has had a noticeable impact on Oregon's semiconductor industry. Employment in the state's chip sector is now at its lowest point in nearly three decades, and other Oregon-based tech companies beyond Intel have experienced similar waves of layoffs.
A recent report commissioned by Business Oregon, the state's economic development agency, warns that Oregon's semiconductor industry risks becoming "insignificant" on a global scale if the state does not actively cultivate new enterprises and build a more robust talent pipeline.
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