Intel doubles layoff plans, now cutting 4,000 jobs

Intel Corporation has announced another round of sweeping layoffs, disclosing plans on Friday evening to eliminate an additional 2,400 jobs in Oregon — nearly five times the number previously reported earlier in the week, according to documents reviewed by The Oregonian.

The decision forms part of a broader restructuring strategy led by Intel’s new CEO, Lip-Bu Tan, aimed at reversing a multi-year decline and repositioning the company for greater competitiveness in the global semiconductor race.

Oregon Hit Hardest

These new job cuts bring Intel’s total planned layoffs in the United States to nearly 4,000, with reductions already underway in California, Arizona, and Texas. However, Oregon — home to Intel’s largest and most advanced U.S. campus in Hillsboro — is expected to bear the heaviest impact.

More than 1,500 roles will be eliminated at Intel’s flagship Ronler Acres campus, as first reported by The Oregonian and verified by state filings.

In an address to employees earlier this week, CEO Tan acknowledged the company’s deteriorating market position: “Twenty, 30 years ago, we were really the leader,” he said. “Now… we are not in the top 10 semiconductor companies,” according to excerpts from internal meetings. His candid remarks underscore the scale of Intel’s challenges and the urgency behind the restructure.

The layoffs represent one of the largest workforce reductions in Oregon’s history. The state’s economy, already heavily reliant on the semiconductor industry, is expected to feel the shock deeply.

Intel, which employed more than 20,000 people in Oregon before the layoffs, plays a significant role in the state’s high-skilled job market. Semiconductor positions in Oregon average approximately $180,000 per year — far above the state median — and mass layoffs are projected to affect consumer spending, housing, and local tax revenues.

Strategic Missteps and AI Shortcomings

Intel’s decline has been years in the making. Once the undisputed leader in chipmaking, the company lost ground to rivals such as Taiwan Semiconductor Manufacturing Company (TSMC), which surged ahead in advanced chip fabrication.

More recently, Intel failed to secure a foothold in the rapidly growing AI training chip market — a segment now dominated by Nvidia. Tan has reportedly admitted in internal discussions: “We are too late to compete in AI training,” but suggested that Intel will shift its focus to adjacent technologies where it still sees opportunity.

Intel’s restructuring extends beyond layoffs in Oregon. The company is exiting the automotive semiconductor segment and is outsourcing large parts of its global marketing operations to Accenture.

Additionally, Intel plans to reduce its workforce by about 20% in its Foundry division, which oversees manufacturing and R&D, Bloomberg reported.

Severance, Support, and Scrutiny

Affected employees will receive severance packages that include 13 weeks of base pay, additional compensation based on tenure, and up to 12 months of health insurance.

In response, Oregon officials are rolling out emergency support measures, including job placement assistance, retraining programmes, and mental health services for displaced workers.

The layoffs have also sparked renewed scrutiny of the estimated $260 million in annual tax breaks Intel receives from state and local governments — incentives originally granted based on expectations of continued investment and job creation.

In a statement to The Oregonian, Intel maintained: “Oregon remains vital to our long-term strategy. These difficult steps are necessary to ensure Intel remains competitive and can continue to invest in future growth.”

The company is expected to provide additional updates during its next earnings call later this month. Analysts and industry observers will be watching closely to see whether Tan’s restructuring plan can stabilise Intel’s performance — and whether the company can reclaim relevance in a tech sector increasingly driven by AI, speed-to-market, and manufacturing agility.