Intel has announced a restructuring initiative to accelerate its evolution from a PC company to one that powers the cloud and smart, connected computing devices. Intel said it will intensify focus in high-growth areas where it is positioned for long-term leadership, customer value and growth, while making the company more efficient and profitable.

The data center and Internet of Things (IoT) businesses are Intel's primary growth engines, with memory and FPGAs accelerating these opportunities – fueling a virtuous cycle of growth, the company said. These growth businesses delivered US$2.2 billion in revenue growth in 2015, and made up 40% of revenue and the majority of operating profit, which largely offset the decline in the PC market segment.

While making the company more efficient, Intel plans to increase investments in the products and technologies that that will fuel revenue growth, and drive more profitable mobile and PC businesses. Through this initiative, the company plans to increase investments in its data center, IoT, memory and connectivity businesses, as well as growing client segments such as 2-in-1s, gaming and home gateways.

These changes will result in the reduction of up to 12,000 positions globally – approximately 11% of employees – by mid-2017 through site consolidations worldwide, a combination of voluntary and involuntary departures, and a re-evaluation of programs. The majority of these actions will be communicated to affected employees over the next 60 days with some actions spanning in to 2017.

Intel said it expects the program to deliver US$750 million in savings in 2016 and annual run rate savings of US$1.4 billion by mid-2017. The company will record a one-time charge of approximately US$1.2 billion in the second quarter.

Intel CEO Brian Krzanich said in an email to Intel employees. "Our results over the last year demonstrate a strategy that is working and a solid foundation for growth. The opportunity now is to accelerate this momentum and build on our strengths. These actions drive long-term change to further establish Intel as the leader for the smart, connected world. I am confident that we'll emerge as a more productive company with broader reach and sharper execution."