Introduction:
Intel is set to release its Q1 2025 earnings on Thursday, April 24, in one of the most critical updates since CEO Lip-Bu Tan took over last month. Investors are closely watching to see if Tan’s turnaround strategy is starting to take shape amid growing competition, falling revenue, and geopolitical trade pressure.
According to Reuters, analysts expect a 3.4% drop in revenue, marking the fourth straight quarterly decline. Losses could grow to $945 million, up from $381 million a year earlier, based on LSEG data.
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Overview:
Revenue Keeps Falling: Intel expects Q1 2025 revenue to drop 3.4%. This will be the fourth straight quarterly decline.
Losses Are Growing: Net loss may hit $945 million. That’s more than double last year’s $381 million loss.
Big Job Cuts Ahead: CEO Lip-Bu Tan plans to cut over 20% of Intel’s staff. More than 22,000 jobs are at risk.
China Market in Danger: China made up 32% of Intel’s 2024 revenue. Tariffs up to 85% on U.S.-made chips could hit hard.
AI Struggles and New Plans: Intel scrapped its Falcon Shores AI chip. It will shift 3nm production to Ireland to dodge tariffs.
PC and Data Center Units Continue to Struggle
Intel’s PC business is still bleeding. For Q1, the client computing group may post an 11% revenue drop to $6.73 billion, according to Reuters.
The data center and AI segment—once seen as a growth engine—is on track for its twelfth straight quarterly decline, with a 1% drop in revenue.
Intel has been steadily losing ground to AMD in PC and server markets. In AI, NVIDIA remains the dominant player, with its H100 and H200 GPUs powering most global AI training systems. Intel’s delay in launching competitive AI chips has further weakened its positioning.
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Massive Layoffs and Leadership Overhaul Under Lip-Bu Tan
Bloomberg reports that Tan will announce job cuts affecting over 20% of Intel’s global workforce—potentially over 22,000 positions. This marks the most significant corporate shake-up since Intel’s founding.
To streamline decision-making, Tan will now directly oversee the heads of PC, data center, and AI chip divisions, as per an internal memo seen by Reuters.
Intel’s workforce stood at over 121,000 employees in 2024. The planned layoffs aim to reduce costs and sharpen Intel’s focus on its core strengths: foundry operations and next-gen chip design.
Trade War Fallout: China Market at Risk
Intel’s biggest external threat right now is the U.S.-China chip conflict. China accounted for 32% of Intel’s 2024 revenue, making it a key market. However, ongoing tensions could place that revenue at risk.
According to the China Semiconductor Industry Association, U.S.-made chips may soon face tariffs as high as 85%. Additionally, like NVIDIA and AMD, Intel now needs a special export license to sell advanced AI chips—like its Gaudi series—to Chinese companies.
In response, Intel is shifting some production away from the U.S. The company’s 2024 annual report highlighted that it will begin high-volume 3nm chip production at Fab 34 in Ireland later in 2025, as reported by Liberty Times and eeNews Europe.
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AI Push Falters with Falcon Shores Cancellation
Intel’s attempts to break into the AI market have stumbled. In January 2025, it canceled the Falcon Shores project, a hybrid CPU-GPU chip aimed at competing with NVIDIA’s AI accelerators.
Former co-CEO Michelle Johnston Holthaus admitted the company still lacks a foothold in the cloud-based AI segment, reported TechCrunch.
Intel now faces pressure to deliver on AI innovation while its rivals surge ahead. Despite this, Q1 could get a small boost from PC makers pulling forward orders in anticipation of potential tariffs.
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Conclusion: A Pivotal Quarter for Intel
Q1 2025 earnings could be a turning point for Intel. With deep job cuts, restructured leadership, and a strategic shift in manufacturing, Lip-Bu Tan is betting on bold moves.
But with declining revenue, fierce competition, and geopolitical risks, the road ahead looks bumpy.
Investors and analysts alike will be watching closely as Intel lays out its recovery roadmap.
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