Agere Systems Inc. will cut 4,000 more jobs "in light of the severe downturn in the semiconductor industry" and also reduced its revenue projection by US$30 million to $920 million for the third quarter, which ends Saturday. Agere was spun off from Lucent Technologies Inc., which is suffering severe financial problems, in March.
The optical communications components maker said it will take a pro forma loss of $0.30 a share including $900 million in charges or $0.08 a share for the quarter without charges. The charges include $470 million in business restructuring costs, and a $255 million write-down in inventory. The company expects to have pretax savings of $520 million as a result of the job cuts and financial charges.
Agere reduced its workforce by 2,000 in April, representing about 11 percent of Agere's 18,500 employees. With the current round of layoffs, the company's work rolls will drop to 12,500 employees.
"We built our business to serve a growing market, which is instead deteriorating," said John Dickson, Agere's president and chief executive officer at a press conference. Agere will focus on communications infrastructure and wireless products, he said.
The future for the industry is hard to see, Dickson said, and because of that Agere's cuts will include its research-and-development budget and staff.
"We're just trying to find the right aim point," he said.
The company is looking for a buyer for its manufacturing plant in Madrid, which is currently running at less than a quarter of its output, Dickson said. Buyer or not, Agere will cease operations at the plant by year's end.
About 1,000 of the 4,000 employees cut in the current round will come from the Madrid plant.