Intel Earnings Q2: Revenue Beat Amidst 15% Workforce Cut and Factory Cancellations
Intel just shared its Q2 2025 earnings, and there’s a lot to talk about.
The good news? Revenue came in stronger than expected. The bad news? The company is going through major changes, including cutting 15% of its workforce and cancelling some big factory projects.
As we look closer, we see a company trying to balance growth with survival. Intel is spending less, laying off thousands, and rethinking how it does business. It’s clear the tech giant is in the middle of a deep transformation.
Let’s talk in detail, what these moves mean, why Intel is making them, how the market is reacting, and what the future could hold. Let’s explore the numbers, the strategy, and the story behind Intel’s bold decisions.
Intel Earnings Q2: Financial Highlights
Intel’s Q2 revenue came in at roughly $12.9 billion. That beat market expectations of about $11.9 billion. Yet the company posted a net loss of $2.9 billion, down 81% year‑on‑year.
On an adjusted basis, that loss translates to about $0.10 per share, instead of the small profit analysts had predicted. One‑time charges dragged down earnings. Intel recorded $1.9 billion in restructuring costs and about $800 million in impairments related to unused tools.
Revenue Breakout & Demand Drivers
Demand in PCs and data center segments held up. Data center and AI chip revenue rose about 4% to almost $3.9 billion. PC client computing revenue slipped roughly 3% to $7.9 billion, but still accounted for most of Intel’s income. Intel’s foundry business grew modestly by about 3% year‑on‑year to $4.4 billion. The CFO noted that some orders may have been pulled forward amid trade uncertainty, boosting current revenue.
Restructuring Measures: Workforce Reductions
We see major cuts in headcount. Intel plans to reduce its core workforce from nearly 99,500 to around 75,000 by year‑end. That is about a 15% cut via layoffs and attrition. Most of the job cuts target middle management. Intel says it removed about half the layers in its hierarchy to flatten the structure and speed up decisions. CEO Lip‑Bu Tan called these moves “hard but necessary” for the firm’s future.
CapEx Scaling Back: Factory & Project Cancellations
Intel is pulling back on costly factory projects in Europe. It has now officially canceled planned mega‑fabs in Germany (Magdeburg) and is scaling back in Poland. That marks a reversal from earlier pauses announced in 2024.
In Costa Rica, Intel will consolidate assembly and test ops to Vietnam and Malaysia, though over 2,000 engineering and corporate jobs remain in place. In Ohio, new factory construction will slow down to match demand forecasts, though investment continues.
Strategic Shift under CEO Lip‑Bu Tan
We see a new tone from leadership. Tan emphasizes that Intel will no longer build expensive capacity without customer demand. “No more blank checks,” he said. His approach is demand-driven, not speculative build-out. Tan also said he reviews every major chip design before tape-out.
Intel is pushing to ramp up its 18A node this year. But the next‑generation 14A node may be abandoned unless Intel secures external customers first.
Market Reaction & Future Outlook
After the report, Intel shares dropped about 4-5% in after-hours trading. Investors reacted to the steep loss despite the revenue beat.
For Q3, Intel forecasts revenue between $12.6 billion and $13.6 billion, slightly above the consensus of $12.65 billion. However, EPS is expected to break even, not match the roughly 5 cents the analysts estimated.
Analysis: Risks and Opportunities
We see execution risks on 18A technology. It must work at scale to compete with TSMC. If it fails, Intel’s foundry ambitions may collapse. There’s also concern about losing talent during layoffs, especially in innovation hubs. And Intel still trails rivals like Nvidia and AMD in AI and server chips.
Intel still has advantages. Its U.S. chip fabs align with federal CHIPS Act goals. This gives access to subsidies and helps appeal to clients who want supply‑chain security.
The 18A node could also renew its edge in performance and energy efficiency. If it attracts AI or cloud clients, Intel could grow its foundry revenue beyond the modest 3% year‑on‑year seen in Q2.
Wrap Up
The Intel Earnings Q2 show a business in full restructuring. Revenue held steady and even beat estimates. But massive charges and job cuts erased profits. Under CEO Tan, Intel is doing a deep reset. We are watching a demand‑driven chip firm take shape. Success will depend on the execution of 18A, securing foundry customers, and keeping key talent. The next few quarters will tell if Intel is rebuilding or just retrenching.
Frequently Asked Questions (FAQ)
Intel made around $54 billion in total revenue in 2024. This amount changes every year based on market demand and product sales.
Sometimes Intel makes a profit, but not always. In 2025, it reported a loss in Q2 due to big spending on changes and factory cuts.
Intel lost $16 billion because of costs from closing projects, cutting jobs, and writing off unused tools. These changes were part of its big turnaround plan.
Intel still earns billions and has strong assets, but recent losses show challenges. The company is working hard to become more stable and competitive again.
Disclaimer:
This is for information only, not financial advice. Always do your research.