Apr

9

US Tech Companies Layoff

Filed Under PC Industry, Semiconductor Industry, Video Gallery 

The weak US economy and poor consumer sentiment as a result of US subprime mortgage mess have taken a severe toll on its tech sector. The S&P technology sector has plunged almost 13% so far in 2008. More and more US tech companies are announcing restructuring and massive layoff. Last week, US cellphone and telecommunication maker giant Motorola announced that it will cut 2,600 jobs worldwide including 700 jobs in Singapore as a result of Motorola’s decision to end mobile manufacturing operations in Singapore by the end of 2008. The layoffs are part of a previously announced $500 million cost-reduction initiative (Ref).

The semiconductor sector is not spared either. According to Gartner, worldwide semiconductor sales were $18.7B in February, about $1B (~5%) below the firm’s expectations (Ref). Gartner also reduced its forecast for total semiconductor market growth in 2008 to 3.4% from 6.2% (Ref). On the same token, iSuppli also reduced its outlook for the NAND flash sector in 2008 by a full two-thirds. It’s projection for global NAND flash memory revenues dropped to 9% for 2008 from 29% (Ref). Last year, Dell announced plans to cut 8,800 jobs, or 10 percent of its work force. So far, the company had cut 5,500 jobs and is going to cut another 1,000 more this quarter (Ref). Aviza Technology announced last week that it will undergo a significant restructuring of its global workforce and products, and it will layoff approximate 15% worldwide workforce (Ref). Yesterday, AMD announced that it will lay off 10% of its staff by the end of Q3 (Ref). Given the current financial market woes and credit crunch, we believe more US tech companies will announce similar restructuring and layoff in the weeks to come.

 

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