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Analog vendors suffer more job cuts, lower forecasts

Posted: 09 Dec 2008 ?? ?Print Version ?Bookmark and Share

Keywords:analog market? job cut? low forecast?

The once-robust analog chip market continues to suffer as vendors report more lay offs and reduced forecasts.

Intersil Corp. has cut its forecast and plans to reduce its workforce by 9 percent. Cirrus, Skyworks and others also cut their forecasts, while specialty foundry provider Tower slashed its workforceagain.

In fact, most analog chipmakers are suffering, including Analog Devices, Fairchild Semiconductor, Linear Technology, Maxim Integrated, National Semiconductor, Texas Instruments and others.

Intersil now expects Q4 revenue to be between $125 to $135 million, an estimated decline of 38 to 43 percent from Q3.

The company's previous guidance was to be down 20 to 25 percent from the Q3. Non-GAAP earnings per share are now expected to be between $0.09 to $0.12.

"As a result of the deteriorating global economy, we are revising our fourth quarter guidance. Approximately five percentage points of this reduction is due to our own actions to reduce distributor inventory in the PC channel, and the balance is the result of a very broad-based reduction in bookings during the quarter," said Dave Bell, president and CEO, in a statement.

"We quickly responded to this downturn with a 9 percent reduction in force and strict control of operating expenses," he said.

Intersil also announced that David Zinsner has resigned from his position as senior VP and chief financial officer. Effective immediately, Jonathan Kennedy has been appointed interim CFO.

Analog Devices Inc. announced that Zinsner has been appointed VP of finance and chief financial officer, effective Jan. 12. Zinsner will succeed Joseph McDonough, who will retire after serving as ADI's chief financial officer since 1991, in accordance with his previously announced intentions.

Lower forecasts
Others are also cutting their forecasts. Cirrus Logic Inc., a supplier of high-precision analog and DSP components, announced it now expects revenue for Q3 of fiscal 2008 to range from $42-to-$45 million, or down 8-to-14 percent from the previous year.

"Our revenue outlook for the current quarter declined substantially during November as manufacturers and distributors sharply curtailed orders, as they appear to be taking a conservative approach in light of current economic conditions," said Jason Rhode, president and CEO, in a statement.

This week, Skyworks Solutions Inc., a supplier of analog and RF semiconductors, announced that the company expects revenue for the Q1 09 to be in the range of $210-to-$215 million with non-GAAP diluted earnings per share of $0.15-to-$0.17.

"We are lowering our guidance to reflect weakness in the handset and broader analog markets," said Donald Palette, Skyworks' VP and chief financial officer, in a separate statement. "In our fourth fiscal quarter earnings announcement of November 6, 2008, we forecasted revenue of $240 million and non-GAAP diluted earnings per share of $0.23."

Foundry job cuts
Meanwhile, Tower Semiconductor Ltd, a specialty foundry, continues to execute its previously-announced cost reduction plan. Tower announced last week a reduction of approximately 200 employees. In addition, Jazz Semiconductor's work force was reduced by approximately 80 employees.

This results in a total reduction of approximately 400 positions in its workforce since the announcement of the signing of the merger agreement with Jazz in May.

"The workforce reductions announced take into consideration the current global economic downturn and its impact on the semiconductor industry as well as the fact that Tower has not yet received from the Israeli government grants related to its capital investments from 2006 to 2008, performed in accordance with its investment plan filed on 2005, which were promised, committed and are over two years past due," according to Tower.

"In response, Tower has filed a petition with the Israeli High Court of Justice targeting an approval certificate from the State of Israel for up to $80 million of grants," according to the firm.

- Mark LaPedus
EE Times





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