It seems like the brief respite from bad news of big tech companies laying off employees has come to a halt. According to a report by CNBC, Qualcomm has announced that it will lay off more than 1,000 employees. As per the report, the layoffs are restricted to California in the US, primarily in the Santa Clara and San Diego offices of the company.
What does Qualcomm have to say on layoffs?
In its quarterly earnings report, Qualcomm said that the layoffs are part of restructuring exercise the company is undergoing. “Given the continued uncertainty in the macroeconomic and demand environment, we expect to take additional restructuring actions to enable continued investments in key growth and diversification opportunities.”
The company further said that while it is still developing plans, it “currently expect these actions to consist largely of workforce reductions, and in connection with any such actions we would expect to incur significant additional restructuring charges, a substantial portion of which we expect to incur in the fourth quarter of fiscal 2023. We currently anticipate these additional actions to be substantially completed in the first half of fiscal 2024.”
A total of 1,258 employees are being laid off in the recent round of job cuts. According to the report out of these 1,258 employees, 1,064 are from San Diego whereas the remaining 194 are from Santa Clara offices. The job cuts will mean that Qualcomm has laid off 2.5% of its total workforce, which is estimated to be around 51,000. Qualcomm, however, isn’t shutting down offices in neither of the two areas.
The layoffs were expected as Qualcomm’s Q3 earnings for 2023 indicated a 25 per cent decrease in sales of mobile chips, compared to the previous year, which amounted to $5.26 billion. Meanwhile, the net income dropped by 52 per cent year over year last quarter.
Qualcomm has predicted that there would be a further decrease in handset sales this year by at least a high-single-digit percentage. The company attributed the downfall in sales to a weaker global economy and a slow recovery in China.
What does Qualcomm have to say on layoffs?
In its quarterly earnings report, Qualcomm said that the layoffs are part of restructuring exercise the company is undergoing. “Given the continued uncertainty in the macroeconomic and demand environment, we expect to take additional restructuring actions to enable continued investments in key growth and diversification opportunities.”
The company further said that while it is still developing plans, it “currently expect these actions to consist largely of workforce reductions, and in connection with any such actions we would expect to incur significant additional restructuring charges, a substantial portion of which we expect to incur in the fourth quarter of fiscal 2023. We currently anticipate these additional actions to be substantially completed in the first half of fiscal 2024.”
A total of 1,258 employees are being laid off in the recent round of job cuts. According to the report out of these 1,258 employees, 1,064 are from San Diego whereas the remaining 194 are from Santa Clara offices. The job cuts will mean that Qualcomm has laid off 2.5% of its total workforce, which is estimated to be around 51,000. Qualcomm, however, isn’t shutting down offices in neither of the two areas.
The layoffs were expected as Qualcomm’s Q3 earnings for 2023 indicated a 25 per cent decrease in sales of mobile chips, compared to the previous year, which amounted to $5.26 billion. Meanwhile, the net income dropped by 52 per cent year over year last quarter.
Qualcomm has predicted that there would be a further decrease in handset sales this year by at least a high-single-digit percentage. The company attributed the downfall in sales to a weaker global economy and a slow recovery in China.
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