Chipmaker Qualcomm is said to be close to laying off thousands of its employees representing around 10% of its workforce, according to the Information website.
The company is expected to announce the cuts on Wednesday, when it releases its quarterly results.
Qualcomm layoffs
Qualcomm reported a 46% drop in its Q2 profits this April, and is facing stuff competition from Taiwan’s MediaTeck and other small Chinese companies that make chips for low cost phones.
The units targeted for the imminent cuts could not be identified, the website said.
Qualcomm may well move some of its research and development activities to cheaper countries such as India, for further cost savings. Another tech site, Fudzilla last week reported that the company may slash 4,000 jobs in its restructuring plans.
In terms of Q3 revenue, Qualcomm forecast revenue and profit below most analysts’ expectations in April, and said the loss of a key customer (Samsung) and delays in product launches by smartphone makers will hurt the sales of its Snapdragon chips.
Samsung this year chose to use its own internal processor for the new Galaxy S6 smartphones, rather than Snapdragon chips from Qualcomm. The company has also been under pressure from hedge fund Jana Partners to spin off its CPU business from the patent licensing businesses.
Furthermore, EU antitrust regulators are investigating whether Qualcomm uses illegal tactics to shut rivals out of the picture, around six years after fining Intel a billion Euros for a similar offence.
SOURCE: Reuters.
Larry Banks is a keen follower of technology and finance. He has worked for a variety of online publications, writing about a diverse range of topics including mobile networks, patents, and Internet video delivery technologies.