Intel, the titan of semiconductor production, revealed in its most recent quarterly report that CEO Lip-Bu Tan is spearheading an efficiency overhaul. This strategy overhaul means some big projects are getting axed.

To put it precisely, both the chip-making operation in Germany and the assembly and testing facility in Poland are no more. Unfortunate as it may seem, both these initiatives have been up in the air since 2024, right after they were announced.

That's far from all of it. In order to trim some fat off, Intel is also planning to centralize its testing operations, moving from Costa Rica to more focused sites in Vietnam and Malaysia.

What brought this on, you ask? The regrets of overinvestment in capacity, as stated by Tan during the quarterly earnings call. In his words, "Our factory footprint has become needlessly fragmented." He further pledges that any future growth will strictly be based on concrete milestones and volume commitments, not a penny to be spent prematurely.

However, pain points don't end there for Intel - another bump in their road to efficiency is the delay of a $28 billion Ohio-based chip factory that has already been postponed earlier this year.

Tan began his tenure as Intel's CEO during this turbulent second quarter and immediately set out to eradicate inefficiencies. His battle plan includes divesting from non-core units and streamlining the company's operations. "Our goal is to reduce inefficiencies and redundancies and increase accountability at every level of the company", he says.

On another serious note, Intel is also reshaping its workforce. The company took several decisive steps, including layoffs that reduced its workforce by about 15%. The aim is to reach 75,000 employees by the year's end. According to Tan, the layoffs have cut half of the management layers.

Sadly, this development echoed an internal memo from Intel in June, revealing plans to cut 15% to 20% of its Foundry unit workforce that designs and manufactures chips for other brands. At the end of 2024, Intel had 108,900 workers, down from 124,800 a year earlier.