Qualcomm, the largest maker of smartphone chips, is cutting jobs to cope with sluggish demand for its key products.
The company will eliminate 1,258 positions in San Diego and Santa Clara, California, according to information filed with the California Employment Development Department. Qualcomm representatives declined to comment on the overall scale of its 50,000-employee layoffs.
More than 750 of the positions being cut are from Qualcomm’s engineering team, ranging from directors to technicians. The rest of the cuts will come from a wide range of positions including in-house technicians and accountants.
Qualcomm said in the notice that the layoffs will begin around mid-December. The San Diego-based company must file documents under California regulations. These obligations in the layoff announcement do not apply to the Company’s other locations.
Chief Financial Officer Akash Palkhiwala told analysts in August that Qualcomm would “aggressively implement additional cost actions.”
“We have previously stated that we will evaluate additional cost actions as the environment continues to evolve,” he said on the call. “Until we see signs of continued improvement in fundamentals, there will not be an immediate recovery in our operating framework .”
The company will report earnings next month, with revenue expected to fall about 19% this fiscal year. Even as Chief Executive Cristiano Amon works to push Qualcomm’s products into new areas, the company still gets most of its sales from mobile phones. Demand for these devices, especially in China, has not rebounded as quickly as some expected.
Qualcomm shares were little changed at $111.10 at 3:05 pm in New York. The stock was up 1% this year as of Wednesday’s close, lagging the Philadelphia Stock Exchange Semiconductor Index’s nearly 40% gain.
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