Friday, May 4, 2018

Qualcomm to cut 1,500 jobs, mostly in California, to cut costs

Qalcomm, the big chip maker for smart phones, has already begun to cut jobs in California. The move appears to be part of a much larger workforce reduction plan that is designed to meet a commitment made to investors to cut $1 billion in costs.

 1 of 2 
Most job cuts will be in California
However, one person said that some jobs will be eliminated in other areas as well. In an emailed statement the company confirmed that it was reducing both full time and temporary workers but they did not specify the exact numbers or locations.
In the statement the company said:“We first evaluated non-headcount expense reductions, but we concluded that a workforce reduction is needed to support long-term growth and success, which will ultimately benefit all our stakeholders.” Severance pay will be offered to those affected.
Qualcomm
Qualcomm is a US-based multinational corporation producing semiconductor and telecommunications equipment. It designs and markets wireless communications products and services. It derives the largest part of its revenue from making chips and much of its profits come from patent licencing. Although it has headquarters in San Diego California it has 224 locations throughout the world. Their website is here. It had 33,800 employees as of 2017.
The promise to investors
In January, Qualcomm promised that it would cut $1 billion in expenses so as to improve earnings. This was part of the efforts of the company to block a hostile takeover bid from its rival Broadcom INc. Although shareholders were set to accept the offer and ignore the promise, the Trump administration stopped the deal on the grounds that it would pose a national security risk. However, the company is still expected to live up to its promise of savings.
Dismal sales and earlier cuts
Qualcomm's sales fell every year since 2015. In fiscal 2018 they are expected to decline by 3 percent.
In 2015 in response to pressure from an activist investor Qualcomm restructured resulting in thousands of workers being laid off.
The precise numbers of the latest reduction should be made clear within the next few days as the company must file Worker Adjustment and Retraining Notifications. Companies are required to file these so-called Warn notices when they let go of 50 or more employees within a 30 day period.
This January Qualcomm was fined $1.2 billion by the European Union for violating anti-trust laws in deals it made with Apple.

Previously published in Digital Journal

1 comment:

Blogger said...

eToro is the #1 forex trading platform for novice and full-time traders.

Twitter to ban dehumanizing speech

Twitter executives Del Harvey and Vijaya Gadde call the new proposed rules part of a continuing effort to promote healthy conversations on ...