Qualcomm announces 2.5% layoffs in California, USA: involving over 1200 people

Qualcomm plans to start a new round of layoffs.On October 13th, American chip giant Qualcomm announced in a document submitted to the California Department of Employment and Development that it will lay off 2

Qualcomm plans to start a new round of layoffs.

On October 13th, American chip giant Qualcomm announced in a document submitted to the California Department of Employment and Development that it will lay off 2.5% of its workforce, mainly in California. The company plans to lay off 1064 employees in San Diego and 194 in Santa Clara, California, with layoffs scheduled for mid December.

As early as August this year, Qualcomm had warned that consumer spending on electronic products such as smartphones continued to be weak due to the global economic slowdown. Expected sales in the fourth quarter to be lower than market expectations, and expressed the possibility of layoffs. Qualcomm last announced a total of 51000 global employees.

As of June 25, 2023, the third quarter financial report data showed that Qualcomm's adjusted total revenue was $8.44 billion, a year-on-year decrease of 23%, lower than the expected $8.5 billion; Adjusted earnings per share were $1.87, higher than the expected $1.81 per share; Net profit decreased to $1.8 billion, a 52% decrease from $3.73 billion in the same period last year.

Qualcomm CDMA Technology Group (QCT) is Qualcomm's largest division, selling processors for smartphones, cars, and other smart devices. The department's sales in the third fiscal quarter were $7.17 billion, a decrease of 24% year-on-year. Among them, Qualcomm's main mobile chip business revenue decreased by 25% to $5.26 billion.

Qualcomm CEO Amon stated during a conference call with analysts in the third quarter that the company would further reduce costs. Qualcomm also stated in a regulatory announcement that cost reduction will include layoffs, but did not specify how many job positions will be affected.

AkashPalkhiwala, Chief Financial Officer of Qualcomm, said, "Our operational framework will not immediately recover until we see signs of continuous improvement in fundamentals, and cost reduction measures will continue into the company's next fiscal year

In September of this year, there were also rumors of layoffs in Qualcomm's research and development department in Shanghai. On September 21st, Qualcomm responded to rumors of layoffs by stating that in its report for the third quarter, the company expected to take further adjustment measures to achieve sustained investment in important growth opportunities and business diversification, given the continued uncertainty of the macroeconomic and demand environment.

Qualcomm stated that although the corresponding plan is still being developed, it is expected that the main measures will include layoffs, and there will be significant additional adjustment costs associated with such measures, with a significant portion expected to occur in the fourth quarter of the 2023 fiscal year. It is expected that the corresponding adjustment measures will be basically completed in the first half of the 2024 fiscal year. The adjustment measures taken in China are also part of the corresponding plan for external communication before.

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