Intel’s new CEO Lip-Bu Tan is expected to announce that 20% of the chipmaker’s workforce, as part of a streamlining plan to rebuild the company. Tan stepped down from Intel’s board last year because he protested that the 15% cut in employees last year was too small to address the company’s dire financial situation, thus his appointment as CEO last month augured further layoffs.
Intel cut its global workforce from 124,800 on the eve of the first round of cuts to 108,900 at the end of 2024. The latest move will also affect Intel’s development centers and manufacturing plant in Israel, which together employ 9,350 people, the lowest number for more than a decade, after more than 1,000 employees were axed last year. Intel last employed about 9,000 people in 2013. In 2012, it employed only 8,500 people.
Since then, Intel has acquired many Israeli companies, including Mobileye, Habana Labs, and Granulite, and most of the employees acquired then have not survived as Intel employees. If the 20% layoffs are applied to the Israeli operations, then the number of Intel Israel employees will fall to 7,500 after the reduction of about 1,800 employees. But estimates are that the number of dismissals in Israel will be much lower.
ANEK Capital managing partner and chief investment officer Orel Levy believes that Mobileye will be sold as part of the new CEO’s measures, but not in the immediate term. He said, “I think Intel will sell Mobileye towards the end of 2026, because by then Mobileye will have started to come out with its more sophisticated solutions, and that could raise the share price and make it easier to sell. Intel currently has no need to sell it on its balance sheet.”
Tan is considered a CEO sympathetic to the Israel operations. He is deeply familiar with the local chip industry from his time as CEO of chip design company Cadence, which has a development center in Israel, and from his investment activities as a Walden Fund partner, as well as a private investor alongside serial chip entrepreneur Avigdor Willenz.
The Israeli companies in which Tan has invested include proteanTecs, Builddots and Vayyar Imaging. Tan stopped investing in Israeli companies several years ago, but he is considered friendly to Intel’s development center, so some believed that the development and manufacturing centers in Israel will be slightly less affected than the rest of the world.
Intel is used to managing its cutbacks through early retirement plans. Late last year, it persuaded several hundred employees in Israel to agree to voluntarily retirement in exchange for a bonus of up to 19 salaries, while hundred more were dismissed in November. Many employees chose to quit and find jobs at other chip companies, including at Nvidia. “Globes” revealed that Nvidia has the largest group of former Intel employees of any chip company in Israel. Employees leaving Intel Israel in the upcoming round of cuts will likely be able to easily find new jobs.
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Levy believes that the rate of layoffs in Israel will be the same as the global rate, but estimates that Intel workers in Israel who are laid off will be able to be absorbed into companies in the industry, such as Nvidia and Camtech, for example.
Oppenheimer Israel senior analyst Sergey Vastchenok notes that many employees have already “dropped out” from Intel and moved to other companies such as Apple, Nvidia, and Tower, and he also believes that employees still at Intel will have no problem finding new jobs at other chip companies, which are looking for talent and knowhow.
Published by Globes, Israel business news – en.globes.co.il – on April 24, 2025.
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