June 19, 2025 /SemiMedia/ — Intel plans to lay off up to 20% of its employees in manufacturing operations, signaling a major shift in its foundry strategy as it grapples with continued financial headwinds and intensifying competition in the semiconductor industry.

An internal memo sent by Naga Chandrasekaran, Intel’s VP of Manufacturing, confirmed that the company would proceed with job cuts starting in July. “While these decisions are painful, they are essential to align our resources with our financial capacity,” Chandrasekaran wrote. Four employees have confirmed the authenticity of the message.

Intel did not comment directly on the memo but reiterated its commitment to treating employees with "care and respect" during the transition.

The layoffs are part of a broader cost-control effort. With Intel employing around 109,000 people by the end of 2024, and estimates suggesting that nearly half are involved in fab operations, the move could affect more than 10,000 workers globally.

The foundry division includes a wide range of roles, from technicians on the production floor to researchers working on next-generation microprocessors. This division has been central to Intel’s efforts to regain competitiveness in advanced node technologies and AI chips.

In addition to the foundry cuts, Intel is also planning workforce reductions in other divisions, although no detailed breakdown has been released. Last year, Intel cut 15,000 jobs globally, including 3,000 in Oregon.

Facing weaker PC and server chip sales, along with delays in advanced product development, Intel is adjusting its investment priorities. Unlike previous layoffs, this round will not include voluntary buyouts, and decisions will be made based on business needs and individual performance.

Analysts view the move as a sign of continued recalibration of Intel’s manufacturing ambitions and a reflection of ongoing pressure from both internal inefficiencies and external market shifts.