Posted by Santa Clara, USA – Mumbai, India: Six months after Intel’s CEO transition, the Santa Clara-based company’s second-quarter 2025 results announced last week reflected its ongoing turnaround efforts under the new CEO Lip-Bu Tan.
Intel posted revenue of $12.6 billion, down 10% year-on-year, and a net loss of $2.7 billion, signalling the continued drag from legacy investments and operational setbacks under former CEO Pat Gelsinger.
“We delivered revenue above the high end of our guidance, reflecting solid demand and execution across the business. I want to thank you all for the work you are doing to move the business forward,” Intel CEO Lip-Bu Tan said in a note to all the company employees post the result announcement last week.
“We are making hard but necessary decisions to streamline the organisation, drive greater efficiency and increase accountability at every level of the company. These actions are critical to strengthening our competitive position going forward,” added Tan.
Gelsinger’s ambitious vision and its fallout
Gelsinger, who stepped down in December 2024, had launched a bold strategy during his four-year tenure. Intel invested nearly $100 billion in manufacturing capacity, advanced process technologies (like Intel 18A and 14A), and global foundry expansion, all part of his IDM 2.0 (integrated device manufacturing) roadmap.
The bulk of that investment went into new fabrication plants in the United States and Europe, alongside efforts to compete directly with TSMC and Samsung in the contract chip manufacturing space. However, persistent execution delays and weakening macroeconomic conditions undermined the returns.
Intel ended 2024 with a net loss of $19.2 billion, which was the company’s first annual loss since 1986, triggering investors unease and setting the stage for the unceremonious exit of Gelsinger, paving with the way of Intel’s CEO transition. Following the Gelsinger’s exit, Intel appointed Lip-Bu Tan as the new CEO in March this year.
CEO Lip-Bu Tan resets Intel’s strategy
Under Lip-Bu Tan, Intel is rolling back several of Gelsinger’s biggest bets in an effort to rein in costs and realign the company with near-term execution. Gelsinger’s ambitious plans for fabs in Germany and Poland have been scrapped, construction of Intel’s large-scale facility in Ohio has been slowed, with spending now aligned to market demand.
More so, the company’s assembly and test operations in Costa Rica are being consolidated into existing facilities in Vietnam and Malaysia.
Intel CEO Tan, a respected semiconductor industry veteran and former CEO of Cadence Design Systems, has taken a far more measured approach compared to his predecessor’s expansive investment style. The company is shifting from vision to delivery.
Workforce reduction and refocused priorities
Intel has also begun reducing headcount to improve efficiency. It has completed most of its planned workforce actions, aiming to reduce its core headcount by about 15%. By the end of 2025, Intel expects to employ roughly 75,000 people, following its planned layoffs and natural attrition.
On the technology front, Intel is now focused on stabilising its 18A process node, a cornerstone of its future product roadmap. The more experimental 14A node has been deprioritised to reduce strain on R&D and avoid the kind of delays that plagued earlier process transitions.
Cautious optimism
The turnaround under Tan is still in its early phase with just two quarters under his leadership. While Gelsinger laid the groundwork with massive investments, Tan is now responsible for showing results and restoring investors’ confidence.
“Our operating performance demonstrates the initial progress we are making to improve our execution and drive greater efficiency. We are laser-focused on strengthening our core product portfolio and our AI roadmap to better serve customers,” said Intel CEO Tan in a statement.
“We are also taking the actions needed to build a more financially disciplined foundry. It’s going to take time, but we see clear opportunities to enhance our competitive position, improve our profitability, and create long-term shareholder value,” added Tan.
While Intel continues to benefit from public funding via the US CHIPS and Science Act, future success depends on near-term execution and a more balanced capital strategy. The impact of Intel’s CEO transition is likely to define the company’s direction for years to come.
Tan’s ability to balance transformation with discipline may determine whether Intel will able to regain its industry leadership or fall behind its competitors in near future.