Intel Plans 22% Workforce Cuts, Possible Chip Manufacturing Exit

Intel's stock has fallen sharply following the company's announcement of extensive job cuts and a warning that it may exit advanced chip manufacturing if it cannot secure a major external customer. CEO Lip-Bu Tan revealed plans to reduce the workforce by up to 22%, halt construction on two plants in Europe, and slow progress on another in Ohio, marking a strategic shift away from previous costly facility expansions. The company reported a surprise adjusted net loss in the second quarter and projected an even larger loss in the third, highlighting ongoing struggles in regaining market share in PCs, datacenters, and the AI sector. Analysts expressed concern over the viability of Intel's foundry business, especially regarding its next-generation 14A and 18A manufacturing processes, with potential asset risks of up to $100 billion if the strategy fails. This situation underscores the challenges legacy chipmakers face in a rapidly evolving industry, with Intel increasingly dependent on rivals like TSMC for advanced manufacturing. Investors remain cautious as Intel navigates these significant operational and financial hurdles amid a competitive and uncertain semiconductor landscape.