SAN FRANCISCONational Semiconductor Corp. said Wednesday (March 11) it plans to close two facilites and cut 1,725 jobs, or 26 percent of its workforce, after reporting that revenue declined more than 30 percent for the quarter ended March 1. The company expects sales to decline further in the current quarter.
In an effort to reduce expenses National (Santa Clara, Calif.) said it would immediately eliminate 850 positions. The company said it would also consolidate manufacturing facilities, eliminating an additional 875 positions over next several quarters.
"The worldwide recession has impacted National's business as demand has fallen considerably," said Brian Halla, National chairman and CEO, in a statement. "However, the actions we announced today will help us remain competitive as we continue to focus on growing markets that can benefit from our new energy-efficiency initiatives."
Revenue for the fiscal third quarter plunged to $292 million, National said, down 31 percent from the previous quarter and 36 percent from the same period of fiscal 2008.
National recorded a net income of $21.1 million, or 9 cents per share, down from $72.9 million or 30 cents per share in the same period of fiscal 2008.
National said it expects sales to decline another 5 to 10 percent in the current quarter.
National said it plans to close its assembly and test plant in Suzhou, China, and its wafer fabrication plant in Arlington, Texas, transferring volume primarily to other company facilities. The closures will occur in phases over several quarters, eventually resulting in the elimination of an additional 875 positions, the company said.
After the consolidation, National will have three manufacturing facilities: wafer fabrication plants in South Portland, Maine and Greenock, Scotland, and an assembly and test facility in Melaka, Malaysia.
Total bookings during the fiscal third quarter decreased by approximately 25 percent sequentially, National said, primarily driven by lower order rates from the distribution channel.
National said it expects to incur charges for the consolidation and job elimination actions of between $160 million and $180 million. Between $130 million to $145 million will likely be recorded in the fourth quarter of fiscal 2009, the company said.