Intel has declared a significant employment decrease, affecting over 15,000 people, as part of a cost-cutting strategy. This measure, aimed at saving USD 10 billion by 2025, is in response to weaker-than-expected financial performance and seeks to streamline processes. CEO Pat Gelsinger emphasised the importance of aligning Intel's cost structure with its new operating model, citing the company's high costs and low margins.
Gelsinger acknowledged the difficulties of the choice and emphasised the company's commitment to transparency and respect throughout the process. He noted that Intel's workforce has risen by 10 per cent since 2020, despite a considerable increase in income, making this reduction vital to ensure long-term viability. He emphasised the necessity of establishing an honest and transparent culture at Intel as it navigates these transitions.
Employees affected by the layoffs will be given more retirement options and voluntary leave programs. Gelsinger highlighted that the implementation of these changes will be consistent with Intel's beliefs. The company would also postpone its equity dividend to prioritise corporate investments and maintain long-term profitability.
Despite facing various challenges, Intel aims to stay committed to its IDM 2.0 strategy. This strategy involves regaining leadership in process technology, increasing manufacturing capacity in the U.S. and the European Union, and continuing investments in core products and artificial intelligence. Gelsinger has communicated to employees that Intel's goal of advancing technology remains a priority. An All-Company Meeting was organised to discuss the changes and answer staff questions.
