Intel cuts hit data center unit despite 22% growth

Intel is reportedly preparing another round of layoffs in its Data Center Group, even though the division has recently been one of the company’s stronger performers.

According to Oregon Live, Intel has warned employees that job cuts could be coming soon, adding to the significant layoffs the company already carried out in 2024 and 2025. Intel has not said how many roles will be eliminated or when workers would leave, but the reported restructuring is aimed at reducing organizational complexity and helping the division move faster.

The move stands out because demand for data center hardware remains strong, driven by continued AI spending and strained supply chains across the sector.

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“As part of our broader strategy to become a more focused and efficient company, (the data center group) is aligning its organization to ensure it has the right roles and skills in place to position the business for long-term success.”

New CEO Lip-Bu Tan had already warned of major workforce restructuring as Intel pushes for greater efficiency.

The cuts are also landing against a relatively healthy financial backdrop. Intel said first-quarter revenue for the data center division was up 22% year-over-year. The company’s stock has also rebounded sharply in recent months following support from the US government. After falling below $20 during parts of 2025, Intel shares had climbed roughly 5x to $105.45 at the time of writing.

Intel is due to report second-quarter 2026 results on July 23, 2026, and is targeting revenue of $13.8 billion to $14.8 billion, up from $13.6 billion in the first quarter.