Intel CEO Lip-Bau is making progress on his plan for the corporate to shed its inefficiencies. And that features spiking a number of manufacturing initiatives.
The semiconductor big reported Thursday in its second-quarter earnings report that it’ll delay, and in some instances, not transfer ahead with a number of manufacturing initiatives. Particularly, Intel stated it was not going ahead with its previously-announced initiatives in Germany and Poland. These initiatives included an meeting and testing facility in Poland and a chip manufacturing facility in Germany. Each initiatives have been sitting in limbo since being suspended in 2024, shortly after being announced.
The corporate additionally plans to consolidate its check operations in Costa Rica and focus these operations to its websites in Vietnam and Malaysia.
“Sadly, the capability funding we make during the last a number of years have been nicely forward of demand and have been unwise and extreme,” Tan stated on the corporate’s second-quarter earnings name. “Our manufacturing facility footprint has change into needlessly fragmented. Going ahead, we’ll develop our capability based mostly solely on the amount commitments and deploy capex lockstep with the tangible milestones, and never earlier than.”
Intel additionally stated it was going to additional delay its $28 billion Ohio chip manufacturing facility. The manufacturing facility was initially purported to open in 2025, and was already delayed once this year in February.
The second quarter was the primary full quarter with Tan on the helm of Intel. He was named CEO of the semiconductor company on March 12 and began the position per week later. Shortly after, Tan stated his plan was to eliminate inefficiencies on the firm by promoting off its non-core models and streamlining operations.
“We now have a lot work to do in constructing a clear and streamlined group, which we now have began in earnest, and is stay an space of focus for me throughout Q3,” Tan stated on the Q2 earnings name. “Our objective is to cut back inefficiencies and redundancies and enhance accountability at each stage of the corporate.”
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The corporate additionally gave an replace on its workforce, which has gone by a number of rounds of layoffs. Intel lowered its workforce by about 15% and plans to finish the 12 months with 75,000 workers, the corporate stated. Intel was capable of get rid of 50% of administration layers by its current layoffs, Tan stated.
Intel introduced in June in an inside memo that it was going to lay off 15% to 20% of staff in its Intel Foundry unit, which designs and manufactures chips for exterior shoppers. The corporate had 108,900 workers on the finish of 2024, in response to the corporate’s annual report filed with the Securities and Trade Fee. That’s down from the 124,800 folks it employed on the finish of 2023.