PHOENIX-- On Semiconductor today reported fourth-quarter product revenues of $490.7 million, a sequential drop of 9% from $539.0 million in the third quarter of 2000, but 15% higher than $427.8 million in Q4 1999.
Like other chip makers, On Semiconductor said it is expecting product revenues to be down 10-to-12% in the first quarter of 2001, compared to $451.5 million in the first three months of 2000.
The Phoenix-based spin-off from Motorola Inc. said it is planning to cut costs and improve efficiencies, including "limited workforce reductions," which will result restructuring charges of $30-to-$40 million in the first quarter. About $60 million will be cut from SG&A costs in 2001.
During an analyst conference call today, chief executive officer Steve Hanson said the company is now running at a 75-to-80% manufacturing utilization rate and hopes to keep its capacity ready for an upturn.
"In the restructuring charges we are taking, we are not touching manufacturing," he said. Instead, the company is considering plant closures of one to two weeks to reduce inventories. It also used recent holidays--such as the Chinese New Year--to lower inventories, he said.
For the fourth quarter, On Semiconductor posted a net income of $21.2 million, exactly the same as a year ago, but lower than earnings of $29.9 million in Q3 of 2000.