Intel is pulling back on its international expansion as part of a sweeping operational overhaul. In its Q2 earnings report, the company revealed it will not proceed with previously planned manufacturing developments in Germany and Poland.

CEO Lip-Bu Tan said the company had overextended its manufacturing network, calling the expansion “excessive.” Testing operations in Costa Rica will also be consolidated into facilities in Southeast Asia to streamline operations.

Tan emphasized Intel will only grow capacity in step with customer demand. He criticized past decisions that led to a fragmented factory layout and committed to aligning capital investments with production milestones.

The company also disclosed layoffs that have reduced its workforce by about 15%. Intel’s Foundry division, which serves outside clients, has experienced the largest cuts so far.