In April, Intel attempted to announce layoffs without announcing layoffs. “We have not set any headcount reduction target,” Intel spokesperson Sophie Metzger told The Verge. But the company has laid off thousands of employees since — and today, in the company’s Q2 2025 earnings, it has revealed that Intel will dramatically shrink as a result of those layoffs. Intel says it will retreat from planned projects in Germany and Poland, end its assembly and test operations in Costa Rica, and finish 2025 with just around 75,000 “core employees” in total.
Intel employed 109,800 people at the end of 2024, of which 99,500 were “core employees,” so the company is pushing out around 24,000 people this year — shrinking Intel by roughly one-quarter. (It has also divested other businesses, shrinking the larger organization as well.)
Today, on the company’s earnings call, Intel’s CEO says that Intel had overinvested in new factories before it had secured enough demand, that its factories had become “needlessly fragmented,” and that it needs to grow its capacity “in lock step” with achieving actual milestones.
“I do not subscribe to the belief that if you build it, they will come. Under my leadership, we will build what customers need when they need it, and earn their trust,” says Tan.
Now, in Germany and Poland, where Intel was planning to spend tens of billions of dollars respectively on “mega-fabs” that would employ 3,000 workers, and on an assembly and test facility that would employ 2,000 workers, the company will “no longer move forward with planned projects” and is apparently axing them entirely.
Intel has had a presence in Poland since 1993, however, and the company did not say its R&D facilities there are closing. (Intel had previously pressed pause on the new Germany and Poland projects “by approximately two years” back in 2024.)
In Costa Rica, where Intel employs over 3,400 people, the company will “consolidate its assembly and test operations in Costa Rica into its larger sites in Vietnam.” Intel spokesperson Sophie Metzger tells The Verge that over 2,000 Costa Rica employees should remain to work in engineering and corporate, though.
The company is also cutting back in Ohio: “Intel will further slow the pace of construction in Ohio to ensure spending is aligned with market demand.” Intel CFO David Zinsner says Intel will continue to make investments there, though, and construction will continue.
It’s not clear if the layoffs will slow now that we’re over halfway through the year, but Intel states today that it has already “completed the majority of the planned headcount actions it announced last quarter to reduce its core workforce by approximately 15 percent.”
So far, partially because of the $1.9 billion that Intel is incurring to do these layoffs and this restructuring, Intel is still losing money this quarter. It’s reporting a $2.9 billion loss on $12.9 billion in quarterly revenue (which is itself flat year over year). Amidst the ongoing AI boom, Intel’s data center business is only up 4 percent year-over-year to $3.9 billion, while its PC chips are down 3 percent to $7.9 billion. Intel’s foundry business, where it does chipmaking for other customers as well, is up 3 percent to $4.4 billion.
The company says it’s on track to shrink its expenses by $17 billion over the full year, and that at least one of its next flagship laptop chips is on track, too: “The first Panther Lake processor SKU remains on track to begin shipping later this year, with additional SKUs coming in the first half of 2026.”
Intel’s follow-up, Nova Lake, is still on track for the end of 2026, according to Tan, and he says he has “taken steps to correct past mistakes regarding multi-threading capabilities” in the company’s Performance cores there. What’s more, Tan says he’s personally taking on responsibility for each new chip design with a new policy that he says is already in effect: “every major chip design needs to be personally reviewed and approved by me before tape out.”
In the meanwhile, Intel says it’s also ramping its popular but previously expensive Lunar Lake chips this next quarter.
Tan says he will also announce new leadership for Intel’s data center business next quarter, and will share more on its strategy for a full-stack AI solution “in the coming months.”
Correction, July 24th: We originally incorrectly calculated that Intel would shed around 33,000 employees, but the actual total should be closer to 24,000. (Intel stated it would end the year with 75,000 core employees, but the 108,900 number we originally compared to was last year’s total headcount including other related businesses, not Intel core headcount, which was 99,500.)
