Qualcomm Layoffs Coming – Chipmaker Facing Competition from Low-Cost Competitors

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Qualcomm announced it’s laying off employees today. The cuts are meant to “trim the fat” a bit and streamline the chipmaker’s workforce.

CEO Paul Jacobs told Morning Star about the company’s cost cutting measures today:

“In fiscal 2014 we are facing some mix and demand factors which we currently expect will moderate our QCT growth. In light of this we are taking near-term actions company-wide to prioritize investments, stay focused on growth but also control expenses in order to deliver operating profit growth in excess of revenue growth.”

So far the downsizing seem to be focused on management, with several cuts and demotions at the vice-president level. However the company has signaled more cuts will be coming down the line, affecting several departments. Qualcomm’s weak 4th quarter for fiscal year 2013 is thought to be the cause.

The company is facing increasing competition from low-cost chipmakers. Also, phone and tablet manufacturers like Samsung and Apple are increasingly developing the chips in their devices in-house.

Qualcomm is still turning a profit, however, and the 31,000 employee company is still a major player on the mobile technology scene.

[Via: GigaOm]

  • Rohan Swarup

    MediaTek is dominating the lost cost phone segment in Asia, which is a huge market. Qualcomm seriously needs to come with a lower cost range of SoCs.

    • Gray Bailey

      Qualcomm will replace many workers that have been there from many years with new employees and many of them will be foreign employees working on visas. It is hard to understand why our government will allow this when Foreign labor certification programs are generally designed to assure that the admission of foreign workers to work in the United States on a permanent or temporary basis will not adversely affect the job opportunities, wages and working conditions of American workers. Be that as it is how many long term workers have been replaced in San Diego ?

      • Guest

        I very much understand your position since that is what it looks like on the surface. I work at Qualcomm San Diego and have been involved in the staffing/interviewing process. Let me bring to your notice that we do not get a lot of “All American” resumes for the advertised positions, and then of the small number of resumes we do get, not many clear the tough technical scrutiny. I have often thought about the discrepancy that you have pointed out but for a company to be competitive in the current markets, quality and commitment of its staff matters above all. On top of that I have had the opportunity to personally interact with potential candidates for hire, but people seem to love vacationing in San Diego but not so open to move here for a job. I for one would be happy to see more non-visa co-workers for a more local team dynamics.

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