, chip maker broadcom said Tuesday that they are gradually decrease the capital investment, mobile phone baseband chip business to cut losses and reduce the one 5 of the workforce, but does not intend to sell.
broadcom early June has announced that it would exit the baseband chip and need to sell the business, but it seems that no one is willing to accept this hot potato.
broadcom chief executive Michael gray said: “we decided to reduce business to minimise losses, this allows us to focus on our core strengths as soon as possible.”
broadcom have cut 250 sales and management positions, and plans to lay off 2250 foreign workers. The 2013 annual report about fellow such as mentioned in the 20% of the 12550 employees.
on Tuesday, broadcom posted a stronger-than-expected second-quarter earnings after the adjustment, and expected the third quarter gross margin, which pushed up the chipmaker shares.
broadcom network connection chips are widely used in smartphones, including apple iPhone. But he lost the baseband chip market share, leading 4 g technology progress is slow, is now held by qualcomm.
California Irvine company is finally baseband chip manufacturing company of the market. Texas instruments can not sell out the mobile chips, cut 1700 jobs in 2012.
bo general combining baseband technology and the network connection way, deal with low-cost smartphone manufacturers in China. Give up baseband will reduce the cost of broadcom, but could also lead to chip manufacturers at a disadvantage in the competition.
broadcom after the adjustment is expected in the third quarter gross margin was 55%, 53% higher than Wall Street expected.
the development prospects of RBC analyst Doug Freedman, is expected to broadcom: “this is proof that give up (baseband) is the right choice.”
as the industry from North America to China and other developing countries, intelligent mobile phone chipmaker, also in the adjustment of business, where consumers like mobile phone below $200, rather than as a top iPhone configuration of equipment.
broadcom shares rose by 3.23% in after-hours trading, 0.31% higher than the regular trading at $38.75.