SGI axes another 600 jobs to cut costs

Silicon Graphics (SGI) will cut another 600 jobs as part of its effort to reduce costs and focus on products that show the most...

Silicon Graphics (SGI) will cut another 600 jobs as part of its effort to reduce costs and focus on products that show the most potential.

The layoffs bring the total number of cuts at the high-end computer company this year to 1,000. Total headcount at the company has been reduced by about 25% over a two-quarter period.

Of the new cuts, 460 will be in the US and 140 elsewhere. After the second round of layoffs, SGI will employ about 3,000 people worldwide, SGI spokeswoman Lisa Pistacchio said.

The cuts are across the company, but salespeople and staff who deal with customers have been spared. 

By the end of the year the restructuring should save SGI about $100m (£64m) in quarterly operating expenses. SGI will record a $20m charge related to the layoffs.

SGI has decided to concentrate more of its research and development efforts on computers used in technical environments that use Linux and Intel's Itanium 2 processors. Meanwhile, the company's Altix line of servers and super clusters, as well as its visualisation and storage products, are faring well.

SGI in July reported a $36.6m (£23.3m) net loss for the fourth quarter of its 2003 financial year ending 27 June. Revenue for the period amounted to $240m (£153m).

Joris Evers writes for IDG News Service

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