Semiconductor maker STMicroelectronics said on Jan. 28 it will cut 4,500 jobs, a tenth of its workforce.
STMicro, ranked fifth among global chipmakers, registered a loss in 2008 of $786 million as sales fell 1.6% to $9.84 billion.
The company said it aimed to achieve savings of $700 million this year through the job cuts and the closure of three factories in the U.S. and Morocco that had already been announced.
The company said sales fell 17% in the final quarter of last year to $2.28 billion and that with the sharp decline in demand, its factories would likely be operating at around 50% of their capacity in the first three months of this year.
First quarter sales were estimated at $1.50-$1.85 billion, down 25%-40% from a year earlier.
STMicro chairman Carlo Bozotti said the decline in the global chip market would likely surpass the 16.3% fall foreseen by the Gartner industry research group in mid-December. "I think the drop will be bigger and will be more than 25%," Bozotti said.
Copyright Agence France-Presse, 2009
