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Quantum cuts staff in sweeping reorganisation

Quantum has announced it is to lay off one-third of its workforce and consolidate parts of its business in an effort to offset...

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Quantum has announced it is to lay off one-third of its workforce and consolidate parts of its business in an effort to offset falling revenues caused by declining hardware sales.

Storage vendor Quantum said it will cut 1,100 positions as it embarks on a restructuring effort expected to continue over the next two quarters. The company currently employs close to 3,000 people and has been hit hard by a slowdown in hardware spending.

The first phase of Quantum's reorganisation will affect the DLTtape Group and Storage Solutions Group. The company plans to outsource much of the manufacturing from those divisions to Jabil Circuit.

Quantum also plans to outsource manufacturing of its P-Series tape libraries. As a result of the deal with Jabil, Quantum said 80% of the workforce will loose their job.

The second phase of the reorganisation includes cutting back on development teams and site locations to help align the company's operations with lower revenue levels.

Quantum hopes the moves will allow it to cut its pro forma operating expenses by close to 20% by the end of its financial year in March 2003. Charges for the restructuring, to be applied during the second and third quarters of its current financial year, are expected to reach $100m (£64.4m), Quantum said.

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