SAN FRANCISCOCiting weakening demand caused by the global economic slowdown, flash memory specialist Silicon Storage Technology Inc. (SST) Wednesday (Dec. 17) cut guidance for the fourth quarter and said it would cut its workforce by about 17 percent, or roughly 120 jobs.
SST (Sunnyvale, Calif.) said it now expects fourth quarter revenue to be between $56 million and $58 million, down from a previous estimate of $63 million to $68 million. The company is now projected a net loss in accordance with generally accepted accounting practices of 11 to 13 cents per share.
SST said the headcount reduction would be completed by the end of the year. The company expects to incur a restructuring charge of approximately $2.8 million, mostly for severance costs. The workforce reduction and other restructuring actions are expected to reduce expenses by $13 million in 2009, SST said.
"Considering the uncertainty over how prolonged this downturn will be, we are taking decisive and necessary actions to control our costs and to reduce our workforce in order to align our organization to the realities of the current demand environment," said Bing Yeh, SST president and CEO, in a statement. "This action is taking place in all locations worldwide, across all product lines and in all functional areas of our company."