Qualcomm To Cut Jobs, Aims To Save $1 Billion In Expenses
American chipmaker, Qualcomm has started to reduce its head count. According to people who are aware of this development, it was revealed that the company will reduce its workforce by 1,500 in California alone. Qualcomm has committed to its investors that it will reduce its operating costs by $1 billion. In order to achieve this number, the chipmaker has decided to slash staff cost. A person familiar with this matter said that apart from California, Qualcomm will also reduce its workforce from other locations.
Qualcomm also confirmed
Globally the company employs nearly 34,000 people. In an official email statement, the San Diego based company confirmed that it is slashing its temporary and full time workforce. However, the email statement did not confirm the number of people that the company plans to reduce. Additionally, in an official statement, the company said that it first assessed the non-headcount expenses but the management decided that in order to sustain long term growth it has to reduce the workforce cost. Reducing the workforce will benefit the shareholders as well. Qualcomm also confirmed that all its staff members who are affected by the downsizing process will be offered severance payments.
Earlier in January this year, Qualcomm had made a commitment to its shareholders and investors that it will reduce cost by 1 billion in order to improve earnings. This commitment was made to fight off an unreceptive acquisition bid from its main competitor Broadcom Incorporation. Shareholders vouched for the takeover deal but the Trump administration vetoed the acquisition deal and said that it will pose a national security threat. Since 2015, sales of the company have been falling drastically. In 2018, sales are likely to decline by 3 percent.
This is not the first time that the company has embarked on a downsizing mission to reduce costs. In 2015, the company sacked thousands of employees after it was pressurized from an activist investor to reduce staff cost. In the coming days, the company will clarify on the total head count that it plans to reduce globally.