Many CPUs use microcode internally: a level of code even lower than machine code. Microcode specifies each step of a machine instruction. Each 8086 micro-instruction is 21 bits long, performing a data move and an action in parallel. Microcode is low-level & hard to understand.
Here's the microcode for the division loop inside the 8086. It does a lot of subtracts and bit rotates (rotate carry left, RCL). An internal 4-bit counter loops through the bits. The photo shows the counter on the die.