diff --git a/.github/workflows/ci.yml b/.github/workflows/ci.yml
index 40374e25..e9d46351 100644
--- a/.github/workflows/ci.yml
+++ b/.github/workflows/ci.yml
@@ -1292,7 +1292,7 @@ jobs:
         fi
 
         # Create bundle directory
-        mkdir ${ARCHIVE_DIR}
+        mkdir -p ${ARCHIVE_DIR}
         pushd ${ARCHIVE_DIR}
 
         # Stage version file
@@ -1351,8 +1351,7 @@ jobs:
         fi
 
         # Stage GNU toolchains
-        mkdir ${ARCHIVE_DIR}/gnu
-        pushd ${ARCHIVE_DIR}/gnu
+        pushd ${ARCHIVE_DIR}
 
         ## Generate target list from the workflow matrix
         TARGETS=$(echo '${{ needs.setup.outputs.targets }}' | jq -cr '.[]')
@@ -1381,8 +1380,10 @@ jobs:
           7z a -t7z -l ${ARCHIVE_NAME}_gnu.${EXT} ${ARCHIVE_DIR}
         fi
 
-        # Unstage GNU toolchain directory
-        rm -rf ${ARCHIVE_DIR}/gnu
+        # Unstage GNU toolchain directories
+        for TARGET in ${TARGETS}; do
+          rm -rf ${ARCHIVE_DIR}/${TARGET}
+        done
 
         # Stage LLVM toolchains
         pushd ${ARCHIVE_DIR}
diff --git a/cmake/zephyr/gnu/generic.cmake b/cmake/zephyr/gnu/generic.cmake
index 21f423fb..4b889cce 100644
--- a/cmake/zephyr/gnu/generic.cmake
+++ b/cmake/zephyr/gnu/generic.cmake
@@ -1,6 +1,6 @@
 # SPDX-License-Identifier: Apache-2.0
 
-set(TOOLCHAIN_HOME ${ZEPHYR_SDK_INSTALL_DIR}/gnu)
+set(TOOLCHAIN_HOME ${ZEPHYR_SDK_INSTALL_DIR})
 
 set(COMPILER gcc)
 set(LINKER ld)
diff --git a/cmake/zephyr/gnu/target.cmake b/cmake/zephyr/gnu/target.cmake
index b080515f..7246f7a4 100644
--- a/cmake/zephyr/gnu/target.cmake
+++ b/cmake/zephyr/gnu/target.cmake
@@ -26,8 +26,8 @@ set(CROSS_COMPILE_TARGET_sparc     sparc-zephyr-elf)
 set(CROSS_COMPILE_TARGET ${CROSS_COMPILE_TARGET_${ARCH}})
 set(SYSROOT_TARGET       ${CROSS_COMPILE_TARGET})
 
-set(SYSROOT_DIR   ${ZEPHYR_SDK_INSTALL_DIR}/gnu/${SYSROOT_TARGET}/${SYSROOT_TARGET})
-set(CROSS_COMPILE ${ZEPHYR_SDK_INSTALL_DIR}/gnu/${CROSS_COMPILE_TARGET}/bin/${CROSS_COMPILE_TARGET}-)
+set(SYSROOT_DIR   ${ZEPHYR_SDK_INSTALL_DIR}/${SYSROOT_TARGET}/${SYSROOT_TARGET})
+set(CROSS_COMPILE ${ZEPHYR_SDK_INSTALL_DIR}/${CROSS_COMPILE_TARGET}/bin/${CROSS_COMPILE_TARGET}-)
 
 if("${ARCH}" STREQUAL "x86")
   if(CONFIG_X86_64)
diff --git a/scripts/template_setup_posix b/scripts/template_setup_posix
index d680bf85..c0cd009b 100644
--- a/scripts/template_setup_posix
+++ b/scripts/template_setup_posix
@@ -52,7 +52,7 @@ check_command()
 check_full_gnu_sdk()
 {
   for toolchain in ${gnu_toolchains[@]}; do
-    if [ ! -d "gnu/${toolchain}" ]; then
+    if [ ! -d "${toolchain}" ]; then
       return 1
     fi
   done
@@ -100,7 +100,7 @@ user_prompt()
         inst_gnu_toolchains=(${gnu_toolchains[*]})
       else
         for toolchain in ${gnu_toolchains[@]}; do
-          if [ ! -d "gnu/${toolchain}" ]; then
+          if [ ! -d "${toolchain}" ]; then
             ask_yn "Install '${toolchain}' GNU toolchain" && inst_gnu_toolchains+=("${toolchain}")
           fi
         done
@@ -217,9 +217,6 @@ fi
 
 # Install GNU toolchains
 if [ "${do_gnu_toolchain}" = "y" ]; then
-  mkdir -p gnu
-  pushd gnu
-
   for toolchain in ${inst_gnu_toolchains[@]}; do
     eval toolchain_filename="${dl_gnu_toolchain_filename}"
     toolchain_uri="${dl_rel_base}/${toolchain_filename}"
@@ -248,7 +245,6 @@ if [ "${do_gnu_toolchain}" = "y" ]; then
 
     echo
   done
-  popd
 fi
 
 # Install LLVM toolchain
diff --git a/scripts/template_setup_win b/scripts/template_setup_win
index 02af1d4c..29169687 100644
--- a/scripts/template_setup_win
+++ b/scripts/template_setup_win
@@ -107,7 +107,7 @@ echo.
 
 REM # Check installation type
 for %%t in (%GNU_TOOLCHAINS%) do (
-  if not exist gnu\%%t\ (
+  if not exist %%t\ (
     set IS_PARTIAL_GNU_SDK=y
   )
 )
@@ -122,7 +122,7 @@ if [!ERRORLEVEL!] equ [1] (
       set INST_GNU_TOOLCHAINS=%GNU_TOOLCHAINS%
     ) else (
       for %%t in (%GNU_TOOLCHAINS%) do (
-        if not exist gnu\%%t\ (
+        if not exist %%t\ (
           choice /c:yn /m:"Install '%%t' GNU toolchain"
           if [!ERRORLEVEL!] equ [1] (
             set INST_GNU_TOOLCHAINS=!INST_GNU_TOOLCHAINS! %%t
@@ -147,9 +147,6 @@ echo.
 :process
 REM # Install GNU toolchains
 if [%DO_GNU_TOOLCHAIN%] neq [] (
-  if not exist gnu\ mkdir gnu
-  pushd gnu
-
   for %%t in (%INST_GNU_TOOLCHAINS%) do (
     set TOOLCHAIN_FILENAME=%DL_GNU_TOOLCHAIN_FILENAME%
     set TOOLCHAIN_URI=%DL_REL_BASE%/!TOOLCHAIN_FILENAME!
@@ -178,7 +175,6 @@ if [%DO_GNU_TOOLCHAIN%] neq [] (
       del /q !TOOLCHAIN_FILENAME!
     )
   )
-  popd
 )
 
 REM # Install LLVM toolchain