Intel has begun executing a new round of layoffs announced two months ago by CEO Lip-Bu Tan as the chipmaker continues its sweeping efforts to reduce costs amid mounting financial and operational pressures.
According to a notice filed under California's Worker Adjustment and Retraining Notification (WARN) Act, the company will begin job cuts on July 15. Affected employees have been given 60 days' notice, or a four-week notice period supplemented by nine weeks of severance pay and benefits.
According to CRN, approximately 107 employees tied to Intel's headquarters in Santa Clara will be affected. Roles impacted include 22 physical design engineers, three engineering managers, three SoC logic design engineers, three product development engineers, four design test engineers, six cloud software architects, four cloud software engineering managers, and two cloud developers.
In a separate report by The Oregonian, Intel is also shutting down its automotive chip business, with most staff in the division facing layoffs. While the company said it would continue fulfilling existing contracts, it will shift focus to its data center and client computing businesses. The decision is part of a broader restructuring plan driven by Gelsinger to streamline operations and control costs.
Manufacturing cuts expected, Malaysia watches closely
Intel's upcoming round of layoffs, expected to begin in July 2025, will also impact manufacturing and wafer-related divisions, adding to concerns in Malaysia, where Intel has made significant investments.
The Penang state government has been closely monitoring the company's activities, especially after reports last September suggested delays or partial shelving of the company's packaging facility in Bayan Lepas. Intel later denied the reports, stating the factory was nearing completion but adding that final commissioning would depend on market conditions and efforts to optimize capacity utilization.
Penang Chief Minister Chow Kon Yeow told The Edge Malaysia that he has been in contact with Intel to assess the company's investment progress. Intel's US$7 billion commitment to Malaysia, announced in 2021, includes two key sites: the advanced packaging facility in Bayan Lepas and another plant in Kulim, Kedah.
Chow said he toured the Bayan Lepas site several months ago and has since seen continued progress, with the facility now approaching completion.
Malaysia's federal Ministry of Investment, Trade, and Industry (MITI) has also held discussions with Intel in recent weeks. Minister Tengku Zafrul Aziz highlighted Intel's longstanding role in Malaysia's electronics sector and said the country remains a top destination for Intel's investments outside the US. However, no new project plans have been confirmed.
Ohio delay raises concerns over US chip strategy
Intel's flagship wafer fabrication plant in Ohio—once billed as a cornerstone of America's chipmaking resurgence—is now facing significant delays. Originally scheduled to come online by the middle of the decade, the facility is not expected to begin production until 2031.
The prolonged timeline is already creating ripple effects. According to NBC4i, cited by Tom's Hardware, AEP Ohio—which invested US$95 million in a 500-megawatt substation to power the site—could see the infrastructure sit idle for up to six years.
The delay highlights Intel's ongoing financial and operational challenges in scaling advanced manufacturing and raises fresh doubts about the pace of Washington's efforts to rebuild a secure and self-reliant semiconductor supply chain.
Article edited by Jack Wu
