“There are no more blank checks,” Tan wrote in a memo to employees published by Reuters. “Every investment must make economic sense. We will build what our customers need, when they need it, and earn their trust through consistent execution.”

The memo directly addresses:

A reduction by about 15% (over 25,000 jobs) via layoffs and attritionOperational streamlining to “drive greater efficiency and increase accountability at every level”Cancelation of new factory projects in Germany and Poland, and a slowdown in Ohio facility construction, adjusting spending to actual market demandRelocation of manufacturing operations from Costa Rica to Asia, while maintaining select engineering functions in Costa Rica.

“We are making hard but necessary decisions to streamline the organization, drive greater efficiency and increase accountability at every level of the company,” Tan, who took over as CEO in March, wrote.

Intel’s stock jumped early in 2025 as optimism built around new leadership, but shares fell over 9% after Thursday’s Q2 earnings and layoff announcement, threatening to erase most yearly gains.

Intel has lost ground to Nvidia in the AI sector and to AMD in traditional computing market. Unlike other Silicon Valley giants, it doesn’t have booming AI or cloud businesses to offset its losses.

Microsoft, IBM, and Google have also shed thousands of workers this year. CEOs, including Meta’s Mark Zuckerberg and Microsoft’s Satya Nadella, have said they are cutting staff to streamline operations and free up capital to invest billions in AI.

For this story, Fortune used generative AI to help with an initial draft. An editor verified the accuracy of the information before publishing.