Tech giant Intel, which is Oregon’s second-largest private employer, announced this week that it will reduce its workforce by 15%. According to The Oregonian, this move could have a substantial impact on the state.

The company plans to cut nearly 15,000 jobs overall, and The Oregonian estimates that up to 3,000 of these job losses could occur in Oregon, assuming the cuts are evenly distributed. Oregon is home to nearly half of Intel’s total U.S. workforce.

In a memo to employees on Thursday, CEO Pat Gelsinger stated that the job cuts are intended to help the company save $10 billion by 2025.

Intel has faced challenges in keeping up with competitors, particularly in the realm of integrating artificial intelligence into its chips, while simultaneously investing in expansion projects in Ohio, Arizona, and Oregon.

The company’s revenue for the second quarter was down 1% year over year, with a forecasted decline of up to 8% for the third quarter.

Mike Rogoway, a tech business reporter for The Oregonian, noted that Intel appears to have felt it had “no choice” but to make these cuts. Rogoway told KGW that the company is in a difficult position and that Wall Street would not tolerate continued high spending without revenue growth. Intel’s executives explained that the cuts are necessary to prevent unsustainable debt and to secure the company’s future, given the current financial strain.

Intel experienced its worst day on Wall Street in fifty years, with its stock dropping more than 25%, bringing it to its lowest point since 2013. The company reported a $1.6 billion loss for the second quarter, compared to a $1.5 billion profit the previous year.

In Oregon, these job cuts mark a dramatic turnaround. Just in March, Intel announced a $36 billion expansion of its Hillsboro chipmaking campus. The company has also benefitted significantly from the CHIPS and Science Act, receiving $8.5 billion in direct funding and $11 billion in loans for chip manufacturing facilities nationwide.

Intel’s expansion projects across Oregon, Arizona, New Mexico, and Ohio were expected to create over 10,000 manufacturing jobs and nearly 20,000 construction jobs. However, if Intel fails to meet certain milestones, it may risk losing some of its CHIPS Act funding.