Another cut for Intel; Chipmaker announces closure of this business unit; to layoff ‘most’ of the staff

Intel

is shutting down its automotive chip division and laying off the majority of employees in the section, reports The Oregonian. As per the report, the company has sent an internal memo to its employees, informing them about the decision. “Intel plans to wind down the Intel architecture automotive business,” the company told employees, adding that the move is part of a larger plan to focus on its “core client and data center portfolio.” In a statement to the publication, Intel said “As we have said previously, we are refocusing on our core client and data center portfolio to strengthen our product offerings and meet the needs of our customers”.“As part of this work, we have decided to wind down the automotive business within our client computing group,” the company added. “We are committed to ensuring a smooth transition for our customers.”

Intel’s auto chip business powered over 50 million vehicles

Intel has invested heavily in automotive semiconductors over the years. Its chips have been used in infotainment systems, instrument clusters, and other vehicle functions in more than 50 million cars. In 2024, the company introduced

AI-enabled chips

designed to enhance in-car navigation and voice assistants. It also announced plans to bring its Arc GPU to vehicles.Despite these developments, Intel now appears to be exiting the segment. The shift comes as part of CEO Lip-Bu Tan’s broader restructuring efforts, aimed at streamlining operations and cutting costs.

Layoffs at Intel

The closure of the automotive unit follows news of broader layoffs across Intel. The company recently issued a WARN notice in California, indicating that 107 employees at its Santa Clara headquarters will lose their jobs. “As we announced earlier this year, we are taking steps to become a leaner, faster and more efficient company. Removing organizational complexity and empowering our engineers will enable us to better serve the needs of our customers and strengthen our execution,” an Intel spokesperson told CRN.Additional job cuts are expected in Intel’s foundry division as well. In April, Tan told employees that Intel would have to “reduce the size” of its workforce in the second quarter of 2025 to improve operational efficiency. The chipmaker is targeting $500 million in cost reductions this year, with more cuts planned for 2026.