Conexant Cuts Jobs, Exits Markets Amid Loss
written by Mark LaPedus of EE Times SAN JOSE, Calif. -- Amid a huge loss, Conexant Systems Inc. has cut 20 percent of its worldwide worforce and plans to exit several chip markets. Conexant announced that it will terminate further investments in "stand-alone" products for wireless networking, but will continue to support DSL gateway solutions that incorporate wireless-networking capability. The company also narrowed its product-development focus during the fourth fiscal quarter by discontinuing further investments in developing network processor solutions and packet switch products, and terminating its investment in HomePlug networking. During the quarter, Conexant also completed a series of restructuring actions that will result in significantly reduced core operating expenses beginning in the current quarter. Effective immediately, Conexant is discontinuing further investment in stand-alone wireless networking product development and will eliminate approximately 140 positions worldwide. In September, Conexant completed a broad-based set of headcount reductions that eliminated approximately 500 positions in the U.S., India, and China. "Including the wireless networking actions announced today, we have reduced our worldwide workforce by approximately 20 percent over the past five weeks," said Dan Artusi, Conexant president and chief executive officer, in a statement. "We will continue working to narrow our product-development focus in order to improve our engineering execution and our ability to deliver innovative, cost-effective solutions to customers on schedule. At this point, our most important company priority is to return to breakeven financial performance as quickly as possible," he said. Fourth quarter fiscal 2007 revenues were $183.9 million, including a non-recurring royalty of approximately $4 million related to an existing license agreement. This compares to sales of $179.5 million in the previous quarter and $245.8 million a year ago. The company recorded a non-cash impairment charge of $192.5 million during the quarter. GAAP net loss was $234.8 million, or $0.48 per share. This compares to a loss of $35.2 million in the previous quarter and a loss of $21.1 million a year ago. For the first quarter of fiscal 2008, Conexant expects revenues to be in a range between $194 and $196 million. |
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