SANTA CLARA, CA – As part of a restructuring plan, Agilent Technologies Inc. announced that it will eliminate 500 positions. The majority of layoffs will occur next year by May 31, with the remaining cuts completed by the end of October. In addition, Agilent has cut over 300 positions within its temporary workforce. Effective January 1, employees will also see temporary pay cuts and/or required time off-without pay. The restructuring, according to the company, will enable annual operating expenses to be reduced by nearly $65 million; the reduction in pay will save $100 million. Agilent plans to take a $55 million pre-tax charge, mostly for employee severance.
LAKE FOREST, CA – Western Digital Corp. (WD) has announced several cost-cutting measures designed to boost its bottom line. The demand for hard drives is below expectations, and revenues for December have been revised. Originally predicted to fall between $2.025 billion and $2.150 billion, new figures expect revenue for the month to be between $1.7 billion and $1.8 billion.
“In the current macro economic climate, we expect demand weakness to last well into the middle of the 2009 calendar year,” said president and chief executive officer John Coyne. “Consequently, we are taking additional steps to immediately reduce production capacity and operating expenses on a longer-term basis across our entire business as we approach the seasonally weaker second half of our fiscal year.”
Those additional steps, scheduled to be completed by March 2009, include a 5% reduction in its worldwide workforce through a layoff that will affect approximately 2,500 employees. One of its hard drive manufacturing plants in Thailand will close, and a media substrate plant in Malaysia will either close or be sold.
Cuts in employee attrition, shift overtime and the use of temporary workers are also scheduled. Executive officers, senior management and board of directors will see their compensation reduced, and WD has decreased its capital spending for 2009 from $750 million to roughly $500 million.
“We are taking these actions in order to strengthen our financial position and enhance the ability of our business to withstand an extended period of depressed demand while continuing to invest in the technologies, products and processes required to assure the continued success of our business,” explained Coyne.
EL SEGUNDO, CA – Excess semiconductor stockpiles in the global electronics supply chain are likely to nearly triple this quarter, says iSuppli Corp. The research firm projects excess semiconductor inventories could balloon up to $10.2 billion in value, up 268% sequentially. This rise is having a deleterious impact on chip pricing, revenue and profitability, and could delay the semiconductor industry's recovery from the current downturn – even when demand rebounds, the firm says.
TAIPEI, TAIWAN – According to recent data from CCID Consulting, China’s smartphone market experienced an increase in sales during the third quarter. Total sales came in at 18.17 billion yuan (US$2.54 billion). This marks a 4.5% increase in revenue. A 0.6% increase over the second quarter resulted from 7.47 units being sold. Sales volume made up 19.3% of total handset sales in China. Nokia and Motorola made up 89.15% of the total market share.
NEW YORK – Research firm Gartner Group today sharply lowered its global semiconductor revenue outlook, saying the market would fall 16.3% in 2009 to $219.2 billion.
Last month, company guided for a 2.2% drop next year.
Semiconductor revenue is expected to drop 4.4% overall in 2008 on a fourth-quarter plunge of 24.4%.
If Gartner proves correct, it would be the first time the market fell in consecutive years.
Gartner forecasts a recovery in 2010 and 2011, with upticks of 14.6% and 9.4% respectively.
ARLINGTON, VA – Electronic component orders took a dip in November, although not nearly as drastic as the one in September, says the Electronic Components Association. The 12-month average, comparing this year’s results to those from 2007, continued the slight descent that began this summer.
Global reports show bleak projections in 2009 for key products that contain electronic components, including automobiles, computers, cellphones and PDAs, says the ECA. One hint of future light came from Henderson Ventures, which predicted that PC shipments would jump more than 13% in 2010 as a result of a combination of economic recovery, replacement cycles, and technological advances such as USB 3.0.
“It’s going to be a matter of sticking to fundamentals,” says Bob Willis, ECA president. “I believe companies must not overreact to or be intimidated by issues beyond their control, but remain focused on their core businesses.”
