National Semi closes phone-chip plant, sheds 340 jobs
Published: 21 May 2003 14:02 BST
National Semiconductor said on Wednesday it is immediately closing a cell-phone chip unit that it earlier put up for sale, cutting the division's 340 positions. The Silicon Valley-based chipmaker also said the restructuring plan it announced in February is on track and expects the cost cutting to save about $30m (£18.25m) per quarter.
The February restructuring plan called for streamlining costs by shedding employees and putting two units up for sale. National Semi said it was still in talks with several prospective buyers for its Information Appliance unit and its Cellular Baseband unit but has decided to close the latter.
The move will reduce its work force by about 340 positions and result in charges of $25m to $30m in its fiscal fourth quarter. National Semi's fourth quarter will end this Sunday.
Despite the closure, National Semi said it is not changing revenue guidance for its fourth quarter. The company expects revenue for the quarter to increase 4 percent to 7 percent from the third quarter, or to about $420m to $432m.
The company will announce its fourth quarter and year-end financial results on 5 June.
The company said that about $16m of the $30m in potential cost savings is related to the Information Appliance unit, which includes its Geode processor for set-top boxes and other devices, and the Cellular Baseband unit. National Semi said these units drummed up less than 5 percent of the company's total revenue.
In February, the company said it would cut its worldwide staff by 5 percent, from about 10,000 employees to about 9,500. National Semi reduced its work force by 500 in its third quarter and with Wednesday's announcement another 340 in its fourth quarter, for a total of 8 percent. National Semi will now have about 9,200 employees.
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