Apr 25, 2025 12:34:00

Intel announces plans to cut staffing and restrict remote work, aiming to shift to a corporate structure that prioritizes engineers and eliminates bureaucracy

On April 24, 2025 local time, Intel CEO Lip Vu Tan sent an email to all employees announcing new measures such as workforce reductions and remote work restrictions.

Lip-Bu Tan: Our Path Forward :: Intel Corporation (INTC)

https://www.intc.com/news-events/press-releases/detail/1738/lip-bu-tan-our-path-forward

Tan said the macroeconomic environment is becoming increasingly volatile and uncertain, citing the need to drive simplicity, speed and collaboration across the company, and announced several key changes that will help Intel achieve its internal goals.

◆ Becoming a company specializing in engineering
CEO Tan said Intel needs to go back to its roots and strengthen its engineers' capabilities. As a first step, Intel promoted its core engineering function to the executive team (ET) in the third week of April 2025. In addition, Intel aims to improve engineer productivity by eliminating cumbersome workflows and processes that slow the pace of innovation.

To make necessary investments in engineering talent and technology roadmap, the company needs to find new ways to cut costs, Tan wrote, revealing that it plans to lower its future operating expenses and capital expenditure targets.

◆ Flattening of the organization
CEO Tan said that while refocusing on engineering, they will also eliminate organizational complexity. Intel's existing teams are more than eight layers long, with unnecessary bureaucracy that slows down work speed. Therefore, CEO Tan mentioned that he has instructed them to review the organization of their engineering teams and focus on reducing hierarchical structures, expanding the scope of management, and delegating the authority of talented people. CEO Tan wrote, 'Our competitors are lean and agile at the same time. We should aim to be like that to improve our execution.'

Tan added, 'In recent years, I was surprised to find that the most important

KPI for many managers at Intel was the size of their team. This will change. I strongly believe in the philosophy that the best leaders do the most with the least amount of people. I will promote this philosophy across the company, empowering our best people to make decisions and increase their accountability for key priorities.'

Tan explained that this change will 'inevitably result in a reduction in our workforce,' and that the company will reduce headcount as quickly as possible over several months, starting in the second quarter of 2025 (April to June). 'We need to balance reducing headcount with retaining and securing key talent. We will empower our leaders to make the best decisions in line with our top priorities. These decisions are not taken lightly, and we will communicate them regularly.'

◆ Streamlining the process
Regarding streamlining processes, Tan explains, 'It was an eye-opener to see how much time and effort we were wasting on internal administrative tasks that weren't driving business growth. We needed to radically streamline these tasks so that we could maximise the time we could spend interacting with customers.'

He told company leaders to eliminate unnecessary meetings and drastically reduce attendance, and he will modernize processes with an emphasis on live dashboards and better data to ensure companies have the real-time insights they need to make faster, better decisions.

Additionally, making the formal requirement of insights and

OKRs optional will provide a simpler and more flexible way to deliver feedback while still maintaining accountability for results, Tan said, as well as reduce unnecessary training, documentation, and other time-consuming internal administrative tasks.

Back to the office
Intel's current policy requires employees with a hybrid workforce that consists of both in-office and remote work to work in the office three days a week, but compliance with the policy is said to be uneven.

'Spending time together in person leads to more engaging and productive discussions and debates, promotes better and faster decision-making, and deepens bonds with colleagues,' said CEO Tan. He announced that the policy will be revised to require four-day office work per week from September 1, 2025.

Tan said that by building a new Intel with the above measures, he will build the team necessary to overturn the industry's disadvantage and win. While acknowledging that it will be a 'difficult road' for Intel to once again become the world's most innovative company, he said, 'To build a new Intel for the future and to better serve our customers, we are aware that we must implement the above measures and make the decision. And I am confident that our team and employees have the power to achieve it.'