Intel announced layoffs in its data center division. Its stock price jumped

Chipmaker Intel has confirmed layoffs in its data center division as part of a cost-cutting and business restructuring program, according to Bloomberg and Business Insider. Against this backdrop, the company’s stock rose nearly 9% during trading on July 21. The Oregonian was the first to report on the planned layoffs at Intel.

Intel announced that it will lay off an unspecified number of employees from its Data Center Group (DCG), which is responsible for data center solutions. Investors reacted positively to the news: Intel’s stock rose 9% during trading on July 21. Since the beginning of the year, the company’s stock has more than doubled amid expectations that CEO Lip-Bu Tan will be able to return the chipmaker to sustainable growth, Bloomberg notes.

“As part of our broader strategy to transform Intel into a more focused and efficient company, DCG is implementing organizational changes to ensure the conditions necessary for long-term success,” a company spokesperson told Business Insider.

The DCG division is one of Intel's main revenue drivers, thanks to growing demand for processors for AI data centers, according to Bloomberg.

The changes will not affect DCG in terms of product releases and development plans, and will also help make the business more efficient, a source told Business Insider.

According to Bloomberg, the layoffs at Intel are part of a long-standing cost-cutting program. As of the end of March, the company employed about 83,200 people, down from more than 130,000 at its peak in 2022. Last year, Intel laid off at least 15% of its factory workers, Business Insider notes.

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