Intel says it will close three back end plants, two in Malaysia and one in the Philippines and two front end fabs one in Santa Clara (D2) and one in Oregon (Fab 20).
The company did not say what the effect on employment would be, because some staff can be re-deployed, but the plants employ 5,000 to 6,000 people.
The news comes after Intel announced a 90% drop in profits for Q408, and warned that the company could face its first loss in 22 years in Q109.
The D2 Santa Clara fab is the fab within Intel’s HQ building. It is the only fab which Intel runs in Silicon Valley.
The front end moves affect the fabs running older processes. Fabs running advanced processes are unaffected by the cuts. The most modern of the company’s stable of front ends are in New Mexico, Oregon, Arizona, Israel and Ireland.
The production cuts come because orders are down and fabs were being run below optimum utilisation levels.
According to Intel CEO Paul Otellini, the semiconductor industry is unlikely to turn up for another six months.