Intel’s new CEO, Lip-Bu Tan, isn’t just tweaking the engine — he’s rebuilding the entire car. Barely four months into his role, Tan is already reshaping the semiconductor giant’s direction by cutting down on what he calls “excessive and fragmented” investments.
In its Q2 2025 earnings call, Intel confirmed what many had been expecting: several high-profile factory projects in Europe are officially off the table. That includes the much-anticipated chip manufacturing plant in Germany and an assembly-and-testing facility in Poland. Both had been in limbo since 2024, and now, Intel has pulled the plug.
The Ohio mega-factory isn’t escaping the shakeup either. Originally billed as a $28 billion game-changer for U.S. chip production and slated to open this year, the project is now facing its second major delay. The new timeline? Unclear.
Tan explained the reasoning behind these decisions in candid terms: “Our factory footprint has become needlessly fragmented. The investments we made were ahead of actual demand — and that wasn’t wise.”
Going forward, he says, Intel’s spending will be tightly aligned with tangible demand and delivery milestones — no more building on speculation. The company will also consolidate its testing operations in Costa Rica and shift more focus to its more efficient sites in Vietnam and Malaysia.
But the biggest restructuring isn’t just about buildings — it’s about people. Intel plans to close 2025 with 75,000 employees, down 15% from last year. That includes slashing 50% of its management layers and a major workforce reduction within its Intel Foundry business.
Tan is clear about what’s ahead: “We’re cleaning house. We’re reducing inefficiencies, cutting redundancies, and holding every level of this company accountable.”
It’s a bold move, and frankly, a necessary one. For Intel, the mission is no longer growth at all costs — it’s smart growth, built on actual market demand, not just ambition. And that shift might just be what the chipmaker needs to stay in the game.
