Intel has announced additional layoffs in its data center division as its stock rises on signs of a turnaround.

Intel has announced additional layoffs in its data center division as its stock rises on signs of a turnaround.

      Intel is laying off more employees in its data center division as CEO Lip-Bu Tan continues to restructure the company, with shares rising nearly 8 percent just two days ahead of the earnings report. The company confirmed on Tuesday that it will eliminate an undisclosed number of jobs in its data center group, which is responsible for Xeon server processors and AI-related technology. This decision is part of a larger reorganization effort led by Tan. In early trading, shares increased by as much as 8 percent, continuing a trend that has seen the stock more than double this year. These layoffs precede Intel's second-quarter earnings announcement scheduled for Thursday.

      Intel stated that the data center group is "aligning its organization to ensure it has the right roles and skills in place for long-term success," although it did not disclose how many jobs would be cut. According to a source familiar with the situation, the changes will not impact the division's product commitments or development plans. Last quarter, the data center and AI segment generated $5 billion in revenue, a 22 percent year-over-year increase, driven by heightened demand for Xeon processors in AI data centers.

      This revenue growth underscores a contradiction at the heart of the layoffs. Intel is reducing personnel in the very unit that is contributing to its financial recovery, indicating that Tan sees the path to recovery as one of efficiency rather than expansion. While the Xeon line is increasingly used as the host processor in AI systems, including Nvidia’s Vera Rubin platform, Intel has yet to produce a competitive AI accelerator chip to challenge Nvidia's GPUs, resulting in significant lost revenue.

      Since replacing the dismissed Pat Gelsinger in March 2025, Tan has eliminated tens of thousands of jobs. Intel concluded the last quarter with approximately 83,200 employees, a decline from a high of nearly 132,000 in 2022, and expects to end the year with around 75,000 employees. These cuts reflect a broader trend in the tech industry, where companies like Meta and Oracle have reduced their workforce while simultaneously increasing investments in AI infrastructure.

      The U.S. government holds a 10 percent stake in Intel, acquired through converted CHIPS Act grants, which is now valued at tens of billions due to the stock's rise under Tan's leadership. The turnaround has been propelled by Intel reaching high-volume production of its 18A manufacturing process, forming foundry partnerships with Apple and Amazon, and fulfilling demand from the AI data center expansion.

      Intel will announce its earnings on Thursday after market close, and investors will closely monitor the data center group's performance. The key question remains whether the revenue growth justifies a stock that has more than tripled from its 2024 lows, or if the market has already factored in more progress than the underlying fundamentals indicate.

Other articles

Another study suggests that AI is detrimental to elections, and the situation continues to deteriorate. Another study suggests that AI is detrimental to elections, and the situation continues to deteriorate. ChatGPT and Gemini struggled to consistently align voters with Hungarian political parties, serving as another cautionary example as campaigns and manipulators discover how easily AI responses can be influenced. Apple's upcoming major experiment with iPhone displays might be its largest one to date. Apple's upcoming major experiment with iPhone displays might be its largest one to date. Apple might be evaluating a display close to 7 inches for an upcoming iPhone, but the speculated panel has not been linked to any completed model or verified independently prior to its potential launch in 2027. Another study indicates that AI has negative implications for elections, and the situation continues to deteriorate. Another study indicates that AI has negative implications for elections, and the situation continues to deteriorate. ChatGPT and Gemini were unable to consistently connect voters with Hungarian parties, serving as a further alert as campaigns and manipulators discover how easily AI-generated responses can be influenced. Major tech companies are concealing $1.65 trillion in AI-related debt that isn't reflected on their balance sheets. Major tech companies are concealing $1.65 trillion in AI-related debt that isn't reflected on their balance sheets. A Nikkei study revealed that Alphabet, Microsoft, Amazon, Meta, and Oracle have $1.65 trillion in off-balance-sheet debt related to AI, exceeding their reported figures. This practice is entirely legal. Eight NATO member countries initiate HALO, a strategy to connect military satellites into a singular, integrated mega-constellation. Eight NATO member countries initiate HALO, a strategy to connect military satellites into a singular, integrated mega-constellation. At the Ankara summit, NATO allies initiated HALO to connect national military satellites for communication, intelligence, and missile tracking throughout the Alliance. Poolside has launched the Laguna S 2.1, an open-weight coding model presented as the Western counterpart to DeepSeek and Qwen. Poolside has launched the Laguna S 2.1, an open-weight coding model presented as the Western counterpart to DeepSeek and Qwen. The 118B-parameter Laguna S 2.1 from Poolside competes with larger models in coding benchmarks, operates on a single desktop, and is aimed at businesses looking to self-host.

Intel has announced additional layoffs in its data center division as its stock rises on signs of a turnaround.

Intel is reducing its workforce in the data center division as CEO Lip-Bu Tan restructures the company, resulting in a nearly 8 percent increase in shares just two days ahead of earnings announcements.