The chips may be down for IntelINTC

, but is their comeback still within reach? Under newly appointed CEO Lip-Bu Tan, the semiconductor company reported better-than-expected Q1 earnings Thursday, but the results and commentary were overshadowed by a dimmer forecast for the coming quarter, sending shares falling 7% in after-hours.

• Intel reported non-GAAP net income of $600M (-24% year-over-year) on $12.7B revenue (flat YoY), impacted by a decline in PC chip sales and a drop in gross margin.
• Intel’s foundry business saw positive momentum with a 7.1% rise, while the data center and AI segment surpassed expectations, achieving $4.1B compared to the anticipated $2.9B.

Back to the drawing board: The chipmaker’s turnaround strategy focuses on removing management layers to enable faster decision-making and prioritizing engineering talent over bureaucracy. Their cost-cutting plan targets $17B in operational expenses for 2025 while trimming $2B from capital expenditures this year. While Intel didn’t specify how many jobs would be eliminated in this restructuring, Bloomberg previously reported the company plans to slash its workforce by over 20%. With no “quick fixes” on the horizon, investors must now determine whether Tan’s aggressive streamlining can finally revive Intel’s competitive edge against NvidiaNVDA

or if they’ll be in for a rocky road ahead.