In the second-quarter financial report released by global semiconductor giant Intel, CEO Lip-Bu Tan announced a series of major changes that mark the company's full commitment to structural reforms to improve efficiency and cut redundancies. These measures include canceling multiple manufacturing projects and delaying the construction of its chip factory in Ohio, USA.
Intel stated that the manufacturing projects originally planned for Germany and Poland have been put on hold. Specifically, these projects include an assembly and test facility in Poland and a chip factory in Germany. These projects have been stagnant since their announcement in 2024. Tan admitted during the earnings call that investments in capacity over the past few years were "ahead of demand and not wise," leading to a fragmented factory layout.
In addition to canceling overseas projects, Intel plans to consolidate its testing operations in Costa Rica, focusing mainly on its production bases in Vietnam and Malaysia. These decisions aim to better align with market demands and ensure maximum return on investment.
More notably, Intel also announced further delays in the start of its $28 billion chip factory in Ohio. The factory was initially planned to be operational in 2025, and it was first delayed in February of this year. These series of changes highlight the increasing challenges Intel is facing in the global semiconductor market.
Since taking office in March of this year, Tan has focused on cutting internal inefficiencies and redundancies, aiming to build a streamlined organizational structure. He pointed out that the company has reduced its workforce by about 15% through several rounds of layoffs, and plans to reduce the total number of employees to 75,000 by the end of the year. Additionally, the proportion of management has also been reduced by 50%. These reform measures will help Intel gain a competitive advantage in the future.
After experiencing market fluctuations and internal integration, how Intel will reshape its future is worth close attention from the industry.