Intel memo says factory layoffs will begin in July

Intel told its factory workers this month that it will begin laying off workers in mid-July, and that “initial” cuts will conclude by the end of that month.

“We have been taking action to build a leaner and more agile engineering- and technician-driven Intel Foundry that is poised to build customer trust,” executives wrote in a memo to factory employees Monday and reviewed by The Oregonian/OregonLive. Intel Foundry is the company’s manufacturing organization.

“These decisions are extremely difficult,” the executives wrote, “but they are necessary to help Intel achieve a more competitive market position and to put our company on a solid footing for the future.”

The memo doesn’t say how many factory jobs Intel plans to cut, or in what areas. Workers in other parts of the organization, who asked not to be identified speaking about their employer, said they believe their business units are on a similar timetable but have been given some flexibility to carry out layoffs in their own way provided they hit financial targets set by top management.

Intel declined to comment on its layoff plans but said in a statement that it is working to become a faster, more efficient organization.

“Removing organizational complexity and empowering our engineers will enable us to better serve the needs of our customers and strengthen our execution,” the company said Thursday. “We are making these decisions based on careful consideration of what’s needed to position our business for the future, and we will treat people with care and respect as we complete this important work.”

New CEO Lip-Bu Tan

announced plans to cut jobs in April

, after the chipmaker reported another quarter of dwindling sales. Intel is coping with intense competition, a downturn in the market for PCs and laptops, and a shift toward artificial intelligence — a huge market where Intel has no advanced products to sell.

Intel eliminated 15,000 jobs last year, under former CEO Pat Gelsinger, in response to mounting financial and investor pressure. It was the biggest round of job cuts in Intel’s history and

cost 3,000 Oregon workers their positions

.

The company remains Oregon’s largest corporate employer, with 20,000 workers in Washington County. They have been anxiously awaiting word on this latest round of layoffs.

Privately, and in online forums, Intel employees have lamented that Tan has said nothing to them about his plans for the company since announcing the pending layoffs in April. At the time, Tan told investors that it was “a little bit too soon” to describe his strategy for rescuing the business. Intel hired Tan in March.

In prior remarks

, Tan had said he intends to emphasize engineering and reduce layers of “bureaucracy” that he blamed for slowing Intel’s pace of innovation. Chief Financial Officer David Zinsner told an investment conference last month that Tan “

isn’t thinking about massive changes

.”

—


Mike Rogoway


covers Oregon technology and the state economy. Reach him at


mrogoway@oregonian.com


or 503-294-7699.

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