Intel Slashes 20% of Factory Workforce in Sweeping Overhaul—Israeli Employees Face Axe

Intel's latest restructuring bombshell lands hard—20% of its global factory jobs are getting the chop. The tech giant's cost-cutting spree now threatens hundreds of positions in Israel alone.

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TLDRs:

• Intel is preparing to lay off up to 20% of its global factory workforce in a major corporate restructuring.
• The company’s Kiryat Gat plant in Israel, which employs roughly 4,000 workers, is among those expected to be affected.
• The layoffs are part of CEO Lip-Bu Tan’s effort to streamline operations and shift focus to execution efficiency.
• Job losses are expected to begin in July, with uncertainty looming over Intel’s Israeli operations amid ongoing regional tensions.

Intel is preparing to slash its global foundry workforce by as much as 20 percent, marking one of the most sweeping overhauls in the company’s history.

The restructuring will impact operations across several countries, with particular attention now turning to Israel’s Kiryat Gat facility, a key site in Intel’s global manufacturing chain. The company employs approximately 9,350 people across Israel, with 4,000 stationed at the Kiryat Gat plant alone.

While past rounds of layoffs have largely spared Core manufacturing hubs like Kiryat Gat, Intel’s latest cost-cutting drive appears more indiscriminate. The layoffs are expected to commence in July and could include mid-level managers, technical specialists, and operational staff. Although exact numbers for Israel remain undisclosed, early internal communications and reports suggest that hundreds of workers at the site may be affected.

Intel Aims to Reinvent Itself 

The MOVE comes amid a wider shift in Intel’s strategic vision under CEO Lip-Bu Tan, who has emphasized a transition toward a leaner, more execution-focused organization.

As part of that evolution, Intel has increasingly turned to contract chip manufacturing in a bid to compete more directly with rivals like TSMC and Samsung. However, with over 20,000 global job cuts already recorded since 2022, even the foundry division, once seen as central to the company’s turnaround is now being restructured.

Internal memos from Intel executives paint a picture of a company balancing between survival and transformation. Naga Chandrasekaran, Vice President of Manufacturing, acknowledged the personal and professional toll in a recent note to staff, stating that the layoffs are painful but necessary to align Intel’s financial position with long-term goals.

Intel Kiryat Gat Facility No Longer Immune

Intel’s Israeli operations have historically enjoyed a degree of protection, bolstered by government incentives and the plant’s central role in chip production. That insulation is now waning. Sources suggest the initial wave of layoffs in Israel will be focused on management-level positions, though broader job categories may also face scrutiny.

The wartime climate in Israel adds another LAYER of complexity, heightening the sense of uncertainty surrounding the plant’s future. While Intel has reaffirmed its long-term commitment to Israel, the current round of layoffs underscores that even flagship facilities are not exempt from restructuring.

Leadership Seeks Efficiency and Focus

In response to recent media coverage, Intel stated that the restructuring is aimed at eliminating organizational complexity and enhancing engineering efficiency. The company reiterated its goal to treat departing employees with care and respect, while pushing ahead with its strategic transformation.

Intel’s foundry layoffs highlight a sobering reality: even in an industry driven by innovation, financial discipline and operational clarity remain non-negotiable. For the workers in Kiryat Gat and beyond, the coming months will bring not just corporate change but deeply personal challenges as well.