SAN FRANCISCO Synplicity Inc. Thursday (March 30) said it would phase out its cell-based and structured ASIC design tools and reduce its global workforce by roughly 8 percent, or about 24 positions.
Synplicity said its decision was based largely on LSI Logic Corp.'s decision, announced earlier this month, to cease development of its RapidChip ASIC platform technology.
“The impact of [LSI's] withdrawal delays the estimated time at which our ASIC software business could become profitable," said Gary Meyers, Synplicity president and CEO, in a statement. "While we continue to see growth potential in the structured ASIC market, we see a greater return in our FPGA implementation, ESL [electronic system level] synthesis for DSP and ASIC verification products.”
Synplicity said it would phase out its Amplify RapidChip, Amplify ISSP, Amplify AccelArray and Synplify ASIC products. Meyers said the company would support its existing customers and "honor our ongoing obligations" with LSI, Fujitsu Microelectronics and NEC Electronics
In withdrawing from structured ASIC tools, Synplicity plans to refocus its R&D and headcount on the company's FPGA implementation and ASIC verification product lines. About half of the company's ASIC R&D team will be redeployed to other technologies, Meyers said.
The 8 percent workforce reduction will be concentrated at the company's Sunnyvale, Calif. headquarters, Synplicity said. The cuts will save the company $4.5 million per year in personnel-related expenses, Synplicity said. Severance costs and the impairment of capitalized software development costs are estimated to result in a charge to Synplicity of approximately $900,000 in the current quarter, the company said.
As recently as last summer, Synplicity's structured ASIC product line appeared to be flying high. When the company announced its second quarter 2005 results last July, Meyers noted that Synplicity had sold a record number of structured ASIC product licenses during the quarter and more than doubled its structured ASIC product books year-over-year.
Interest in structured ASIC, once a hot product market, appears to have waned in recent months. In addition to LSI's departure from the market, Lightspeed, a supplier of mask-reconfigurable logic arrays, last month changed its name to Lightspeed Logic and said it would transition from a structured ASIC vendor to a supplier of intellectual property (IP).