STMicroelectronics cuts 2,500 jobs worldwide

STMicroelectronics (ST), Europe's largest chipmaker, confirmed today that it is eliminating 2,500 jobs.

STMicroelectronics (ST), Europe's largest chipmaker, confirmed today that it is eliminating 2,500 jobs.

"The figure relates to a reduction in our workforce mostly by attrition. About 200 people have lost their jobs on an involuntary basis and at most, another 450 people will be laid off," said ST's UK-based spokeswoman, Janice Fenton.

The company also announced additions to its line of enhanced security smart card micro controller units, called ST19.

Blaming a steep slump in the semiconductor market, the company announced in May that it was closing its wafer fabrication plant in Canada. 450 employees have been offered relocation but it is unknown how many will choose to take the offer.

In the US, 300 ST employees have already left the company on a voluntary basis, while 200 employees were laid off. More layoffs in the US can be expected, Fenton said.

In July, citing order cancellations in its telecommunication and computer peripheral businesses, the company posted second-quarter revenue of $1.59bn, down from $1.88bn in the same quarter last year. At the time, ST also warned that lower earnings would continue into the third quarter.

ST indicated in July that it expected the industry to bottom out in the third quarter of 2001 with revenue declining by between 10% and 15% from the previous year. It expects to see signs of a recovery in the fourth quarter.

ST supplies chips to large players in various parts of the technology industry worldwide with customers including Nokia, LG Electronics and Hewlett-Packard.

Further information
STMicroelectronics: www.st.com/

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