In a sign that the cost cutting efforts are continuing at Seagate the vendor has announced plans to axe a Singapore plant and bid farewell to 2,000 staff.
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The hard drive specialist expects to produce annual savings of $40m by closing the HDD manufacturing plant by the end of next year and relocating the work to elsewhere.
Those savings will have to come after it gets a $80m restructuring charge out of the way to cover the costs of the plant closing with $60m being recorded in the first quarter and the rest being spread across the rest of its financial year.
“This closure and relocation is part of the Company's ongoing focus on cost efficiencies in all areas of its business and is intended to facilitate leveraging manufacturing investments across fewer sites. The Company does not expect the closure to meaningfully change production capacity,” stated the vendor in an SEC filing.
In its most recent results, for the year ended 3 July, Seagate saw sales plummet to $9.8bn from $12.7bn in 2008 and losses totalled $3bn compared to a profit of $1.26bn a year earlier.
For the fiscal fourth quarter ended 3 July, losses were $81m including restructuring charges and goodwill write-downs that totalled $106m. Sales fell to $2.35bn from $2.89bn a year ago.
At the time, Stephen Luczo, Seagate CEO said the company had made“meaningful progress toward the goal of returning to sustained GAAP profitability as soon as possible.”