SAN JOSE, Calif. -- Citing the fab-tool downturn, Lam Research Corp. plans to reduce its headcount by 600 jobs, or approximately 15 percent of the company's total workforce.
Lam's so-called ''restructuring plan'' is expected to be completed during the first calendar quarter of 2009.
''When completed, the restructuring plan is expected to result in annualized cost savings of approximately $60 million,'' according to a filing with the U.S. Securities and Exchange Commission (SEC).
''The company is implementing further cost reduction activities which are not part of the restructuring plan that are targeted to result in annualized cost savings of approximately $20 million for a total annualized cost savings of approximately $80 million,'' according to the filing.
A decline of 20 percent in worldwide fab equipment spending is expected for 2008, according to SEMI. For 2009, semiconductor capital spending is now projected to range from plus 5 percent to minus 10 percent, according to SEMI.
''We believe that these estimates, although recently revised down, are still too optimistic,'' said David Motozo Rubenstein, an analyst with Jefferies Japan Ltd.
''The (fab-tool) industry is damaged by latent overcapacity, a result of years of high-level spending in memory equipment,'' he said in a report. ''Many chip makers are financially burdened with negative cash flows and large debt levels, which contributes to the capex cuts.''
Indeed, times are bad in the sector, which faces another downturn. Capital spending has grinded to a halt. And Axcelis, Cognex, Entegris, FSI, Intevac, Mattson, Micronic, SemiTool, Tegal and other fab-tool makers have recently announced layoffs.
Applied Materials Inc. said last week it would slash its workforce by about 12 percent, or roughly 1,800 jobs. Chip manufacturing equipment provider KLA-Tencor Corp. will reduce its global workforce by about 900 people as one of several cost-reduction actions in an effort to lower its quarterly run rate by $165 million to $170 million, the company said Tuesday (Nov. 18).
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