14 DAY TRIAL // Flash memory chip maker Spansion has recently announced that it will cut 750 jobs, which represents about 20 percent of the company's workforce, in order to reduce operation expenses in a weak macroeconomic environment.
The Sunnyvale, California-based company announced its move in a filing made with the U.S. Securities and Exchange Commission Wednesday, reports the EETimes publication.
According to this filling, most of the job cuts (610 of the 750 total) will be made by closing a test and assembly facility in Kuala Lumpur, as Spansion wants to consolidate its test and assembly operations into a single existing fab near Bangkok.
By taking this decision, the chip maker expects to save about $30 million (21.8 million EUR) and this process should by finalized in the first quarter of 2012.
"With macroeconomic weakness expected to continue in the near-term, we are taking proactive measures to reduce operating expenses while strengthening customer relationships and accelerating adoption of new products to position Spansion for long-term market leadership," said John Kispert, Spansion's president and CEO, in a statement.
This announcement comes after Spansion reported weak financial results for the third quarter of this year, with sales down 14 percent compared with Q2 2011, and 19 percent down when compared to the third quarter of 2010.
The company's net income also took a hit as it reached just $7.3 million GAAP (5.31 million EUR), down from a net income of $25.3 million (18.41 million EUR) in the previous quarter.
Furthermore, in the fourth quarter of this year, Spansion expects sales to decline further, reaching between $205 million and $225 million (185.57 and 163.74 million EUR).
Outside of the Kuala Lumpur and Bangkok facilities, the Flash memory maker also operates a fab in Austin, Texas, known as Fab 25, which acts as the company’s main wafer fabrication facility.