By ByteBot
Intel is cutting 25,000 jobs by the end of 2025—a quarter of its workforce—as new CEO Lip-Bu Tan abandons his predecessor’s factory expansion bet in favor of brutal cost discipline. In a July 25 memo, Tan declared “no more blank checks” and signaled Intel’s most dramatic restructuring in 40 years. The cuts accelerated in November, with 669 Oregon workers added to the layoff list on November 13 and CTO Sachin Katti departing for OpenAI just six months into the role.
Moreover, Tan’s pivot from growth to efficiency is already showing results: Intel posted a $4.1 billion profit in Q3 2025 after losing $19 billion in 2024. However, the human cost is steep, and the strategic gamble is risky. Can Intel stabilize financially while competing with TSMC’s 70% foundry dominance? The answer depends on whether cutting a quarter of your engineers helps or hurts when you’re trying to execute on advanced chip technology.
Intel Layoffs: 35,500 Jobs Gone in Two Years
Intel has cut 35,500 jobs in less than two years—15,000 under former CEO Pat Gelsinger in 2024, and another 20,500 in approximately three months under Tan. Furthermore, the pace is extraordinary: 20,500 cuts in roughly 90 days works out to more than 200 jobs eliminated per day. Intel’s workforce dropped from over 100,000 to 88,400 by September 27, 2025, and is heading to 75,000 by year’s end.
The Q2 2025 restructuring alone cost Intel $1.9 billion in charges, plus $800 million in asset write-downs. Additionally, Oregon, home to Intel’s largest U.S. operations, has been hit particularly hard. The state’s Intel workforce peaked at 23,000, fell to 18,000 after earlier cuts, and will drop by another 669 by December. These aren’t just numbers—they represent one of the largest tech layoffs in recent history.
From “Field of Dreams” to “No More Blank Checks”
Tan is systematically dismantling Pat Gelsinger’s IDM 2.0 strategy, which bet billions on factory expansion to compete with TSMC. Gelsinger’s vision: build massive fabs and customers will come. The reality: Intel’s foundry unit brought in $18.9 billion revenue in 2023 but lost $7 billion. Gelsinger himself admitted he “underestimated the difficulty of the foundry business.”
Consequently, Tan’s response has been swift and unforgiving. He cancelled fabs in Poland and Germany, slowed construction in Ohio, and tied all future factory build-outs to confirmed customer commitments only. His memo to employees was blunt: “Over the past several years, the company invested too much, too soon—without adequate demand. Our factory footprint became needlessly fragmented and underutilized.” Translation: Gelsinger’s “field of dreams” approach failed, and Tan isn’t repeating the mistake.
The shift extends beyond factories. Intel implemented a return-to-office mandate requiring four days per week—up from three—effective September 2025. The previous three-day policy had “uneven adherence,” code for employees weren’t complying. The stricter mandate signals Tan’s broader culture reset: no more blank checks on flexibility either.
Profit Returns, But TSMC Pulls Further Ahead
The financial turnaround is real. After losing $19 billion in 2024, Intel posted Q2 2025 revenue of $12.9 billion—beating expectations despite a $400 million adjusted loss driven by restructuring charges. Q3 2025 was even better: revenue and earnings exceeded forecasts, delivering a $4.1 billion profit. Four consecutive quarters of improving execution suggest Tan’s cuts are working.
Nevertheless, here’s the problem: while Intel stabilizes financially, TSMC extends its technological lead. TSMC’s foundry market share grew from 67.6% in Q1 2025 to 70.2% in Q2 2025. Intel holds less than 5% share and doesn’t crack the top-10 foundry rankings. TSMC is mass-producing 2-nanometer chips in the second half of 2025. Intel is betting on its 18A process node—and trying to execute it while cutting 25% of its workforce.
The 2030 projections tell the story: analysts expect TSMC to hold 60-65% market share, Samsung 10-15%, and Intel 5-10%—if Intel executes perfectly. That’s a big “if” when you’ve just eliminated a quarter of your engineering talent.
Morale “At Rock Bottom” as CTO Exits for OpenAI
Employee sentiment inside Intel is grim. Current and former employees describe morale as “at rock bottom” and “in the toilet.” A former senior manager explained: “The change in direction, the layoffs, the comp not being as good as it should be—it’s all piling up.” Multiple sources report that workers went from feeling like “valued contributors—part of a family” to “cogs in a machine designed to maximize profit.”
The November 10 departure of CTO and Chief AI Officer Sachin Katti to OpenAI crystallizes the problem. Katti was appointed in April 2025—just six months before leaving. Losing your top technical executive to a competitor after half a year signals deep cultural and strategic problems. Tan has now assumed direct oversight of Intel’s AI and advanced technology divisions, concentrating more power and creating potential single points of failure.
The morale death spiral is predictable: layoffs create anxiety, the RTO mandate forces relocation, compensation lags competitors, and the best engineers—who have options—leave first. That weakens the talent pool precisely when Intel needs to execute flawlessly on 18A. More pressure leads to more cuts, which drives more departures. It’s a vicious cycle.
Intel’s CHIPS Act Dilemma: Taxpayer Billions, Factory Cuts
Intel received $7.86 billion in CHIPS Act funding to build U.S. semiconductor manufacturing capacity. The Trump administration added another $8.9 billion equity investment. Combined with Intel’s own commitments, the company promised over $100 billion to expand American chip production and create tens of thousands of jobs.
Then Tan started canceling factories and cutting 25,000 jobs. Poland fab: cancelled. Germany fab: cancelled. Ohio fab: slowed, now tied to customer demand. The promised jobs—10,000 Intel permanent positions, 20,000 construction jobs, 50,000 supplier jobs—are vanishing. Instead, Intel is eliminating workers at a rate of 200+ per day.
This creates political risk. Congress gave Intel the largest CHIPS Act award to secure American semiconductor leadership against TSMC’s Asian dominance. If Intel takes the money but doesn’t build capacity, lawmakers may demand clawbacks or attach performance requirements to future funding. The U.S. needs Intel to succeed—but Intel appears to be pivoting away from the very role government is paying it to play.
Key Takeaways
- Intel is cutting 25,000 jobs (25% of workforce) by end of 2025, bringing total cuts to 35,500 in less than two years—one of the largest tech layoffs in history
- CEO Lip-Bu Tan’s “no more blank checks” philosophy abandons Gelsinger’s factory expansion strategy, canceling Poland and Germany fabs while slowing Ohio construction
- Financial turnaround is working: $19 billion loss in 2024 became $4.1 billion profit in Q3 2025, but TSMC’s market share grew to 70.2% while Intel remains under 5%
- Employee morale is “at rock bottom”—the CTO left for OpenAI after six months, and the four-day RTO mandate is accelerating talent exodus
- Intel took $7.86 billion in CHIPS Act funding to build U.S. factories, then cancelled international fabs and cut 25,000 jobs—creating political and strategic risk
Tan’s gamble is clear: stabilize the balance sheet now, worry about technological competitiveness later. Whether Intel can execute 18A while cutting a quarter of its engineering talent will determine if American semiconductor manufacturing has a future—or if TSMC’s dominance becomes permanent.
