Qualcomm (Qualcomm), which announced a cost-cutting plan in January, has started layoffs, including full-time employees and temporary employees, but the number of layoffs has not been revealed.
EE Times has obtained a Qualcomm spokesperson for confirmation that the company’s personnel reduction has already started. This was also disclosed earlier by Bloomberg, Reuters and other media. The spokesperson said in an email replying to EE Times’s query: We first evaluated the reduction in non-employee spending, but concluded that layoffs are needed to support long-term growth and business success, and ultimately benefit all shareholders.
Qualcomm’s letter sent to investors in January indicated that the company will formulate a $1 billion cost-cutting plan; at that time, the Qualcomm board was resisting Broadcom’s hostile takeover. The Qualcomm spokesperson said: “To reduce such personnel, It is not only those employees who have been punished, but also their families, co-workers and communities. We understand this and will also provide supportive severance payments for affected employees to reduce the impact they experienced during this transitional period. '
Shortly before the Qualcomm layoffs were revealed, the company was hit by the seven-year ban announced by the US Department of Commerce because Qualcomm and several American chip makers were prohibited from selling products to Chinese communications equipment maker ZTE. According to the U.S. Department of Commerce, the ban was because ZTE violated the terms of the deal signed last year and was arrested still selling telecommunications equipment to countries such as Iran and North Korea.
ZTE is one of Qualcomm's major customers. Qualcomm spokesman declined to disclose how much of the company's annual revenue was contributed by ZTE; however, industry observers estimate that ZTE's order amount is about 500 million US dollars a year.
Compilation: Judith Cheng