SAN FRANCISCOMarvell Technology Group Ltd. said Thursday (March 5) it will cut its workforce by 15 percent in an effort to reduce costs. The company said it swung to a loss in the quarter ended Jan. 31 as revenue declined 35 percent sequentially and 39 percent year-over-year.
Marvell said the cost reductions, which will impact about 850 jobs, will result in restructuring charges of about $20 million, including about $14 million related to severance and other employee benefit payments and approximately $6 million related to facility consolidation.
A Marvell spokesperson said the job reductions would be carried out across the board and that the facilities consolidation involved closing or consolidating some of the company's smaller regional sites. For example, the spokesperson said, two regional facilities located in Austin, Texas will be consolidated into one.
Marvell (Santa Clara, Calif.) reported a GAAP net loss of $65 million, or 11 cents per diluted share for the fiscal fourth quarter of 2009. The company reported a net income of $71 million for the previous quarter and $1 million for the year-ago quarter.
Net revenue for the fiscal fourth quarter fell to $513 million, Marvell said, down from $791 million in the fiscal third quarter and $845 million in the fourth quarter of fiscal 2008.
For full fiscal 2009, Marvell posted a GAAP net income of $147 million (23 cents per diluted share) on revenue of $2.95 billion. The company had reported a GAAP net loss of $114 million, or 19 cents per share, on revenue of $2.89 billion for fiscal 2008.
Marvell said it's fiscal fourth quarter non-GAAP net income, excluding charges, declined to $32 million, or 5 cents per share. Non-GAAP net income was down 78 percent sequentially and 74 percent year-over-year, the company said.
In a statement, Sehat Sutardja, Marvell chairman and CEO, said Marvell believes the current challenging business climate will not substantially improve in the short term.
"Consequently, we are taking actions to re-align our business to reflect the realities of the current economic environment," Sutardja said.