LSI Logic Corp. (Milpitas, Calif.) cut 510 positions, approximately 11 percent of its workforce, as the semiconductor supplier announced a comprehensive restructuring program after an unprofitable third quarter.
The company reported a third-quarter loss of $282 million, or 73 cents per share, on sales of $380 million, compared to a net loss of $32 million, or 8 cents per share, on sales of $450 million in the year-ago third quarter. In the previous quarter, LSI earned $7 million, or 2 cents per share, on sales of $448 million.
Charges in both the third and fourth quarter relate to LSI's factory in Gresham, Ore. In total, the company will take $383 million in non-cash asset impairment charges related to the factory.
"The wave of third-quarter pre-announcements throughout the global semiconductor industry reflected customer end-demand reassessments and the ongoing industrywide effort to work down excess supply chain inventory by the end of the year," said Wilfred Corrigan, LSI Logic's chairman and chief executive, in a statement. "We have taken proactive steps to realign our R&D and SG&A expenses to our current revenue expectations, including a difficult but necessary 11 percent reduction in force."
Corrigan added that revenue from consumer applications grew slower than expected, while excess inventories affected the company's Storage Components business.
For the fourth quarter, LSI is projecting revenue of $360 million to $390 million, with a net loss per share of 54 to 57 cents including special charges.