Texas Instruments to switch focus from cellphones, cut 1,700 jobs
The company's wireless division just recorded its third quarter of losses
IDG News Service - Texas Instruments will lay off 1,700 employees as it refocuses its efforts away from the wireless sector -- including cellphones and tablets -- and toward embedded systems, the company announced Wednesday.
The news comes less than a month after TI said its wireless business recorded its third-straight quarter of losses.
TI has targeted its OMAP processors at cellphone and tablet PC makers, and its OMAP chips had found a number of big-name customers including Motorola, Samsung, Sony Ericsson, Huawei, Amazon and Barnes & Noble.
But TI said it plans to refocus its development efforts in new areas as device makers look to develop their own processors. Apple and Samsung, two of the top smartphone makers, both design their own chips, using technology from ARM Holdings.
During its most recent quarter, TI said wireless sector sales had fallen by almost half against the same period a year earlier. The business, which recorded a US$78 million profit in the same quarter a year ago, fell to a $53 million loss.
Device makers are being influenced by Apple, which initially used off-the-shelf processors in its iPhone line and recently made a switch to an Apple-developed processor called the A6.
Embedded devices refer to products that are custom-designed to do a single job, such as a car navigation system or air conditioning controller.
"We have a great opportunity to reshape our OMAP processor and wireless connectivity product lines to concentrate on embedded markets," Greg Delagi, senior vice president of Embedded Processing at TI, said in a statement. "Momentum is already building with new embedded applications and a broad set of customers, and we are accelerating our efforts in these areas."
While TI's embedded business is doing better than its wireless division, the results are also falling.
Revenue dropped by 4 percent in the most recent quarter, to make the embedded division larger than the wireless division, while profits fell 44 percent to $63 million.
The layoffs will hit TI employees worldwide. The Dallas, Texas-based company said it hopes to save $450 million per year from the restructuring, which will incur a one-off cost of $325 million.
Martyn Williams covers mobile telecoms, Silicon Valley and general technology breaking news for The IDG News Service. Follow Martyn on Twitter at @martyn_williams. Martyn's e-mail address is email@example.com
- Why Projects Fail CIOs are expected to deliver more projects that transform business, and do so on time, on budget and with limited resources.
- The New Business Case for Video Conferencing: 7 Real-World Benefits Beyond Cost-Savings This whitepaper provides insight into the value of video conferencing in today's business environment, and how organizations are using visual collaboration to find...
- Gartner Magic Quadrant for Client Management Tools The client management tool market is maturing and evolving to adapt to consumerization, desktop virtualization, and an ongoing need to improve efficiency.
- Audit Ready and Asset Optimized: The Solid Promise of an Intelligent Software Asset Management Solution In this paper Frost & Sullivan examines the benefits of enterprise-grade Software Asset Management solutions, and how these solutions serve as the convergence...
- LIVE EVENT: 5/7, The End of Data Protection As We Know It. Introducing a Next Generation Data Protection Architecture. Traditional backup is going away, but where does this leave end-users?
- On-demand webinar: "Mobility Mayhem: Balancing BYOD with Enterprise Security" Check out this on-demand webinar to hear Sophos senior security expert John Shier deep dive into how BYOD impacts your enterprise security strategy... All IT Careers White Papers | Webcasts