Xilinx cuts 250 jobs
The job cuts come after significant management changes at the company, including naming Moshe Gavrielov as the FPGA maker's new CEO. The layoffs also come a day after Xilinx’s competitor Altera updated its Q2 earnings forecast, saying it expects sequential revenue growth to be at the high end of its previous guidance calling for a 1 to 4% increase.
By Suzanne Deffree, Managing Editor, News -- EDN, June 4, 2008
Xilinx Inc will lay off approximately 7% of its workforce as part of a corporate reorganization.
The 250 job cuts announced today are expected to be completed by the end of the September quarter.
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The layoffs come after significant management changes at the programmable logic company. In January, Xilinx named Cadence veteran Moshe Gavrielov president and CEO as Wim Roelandts exited the role, remaining as chairman of the board. In an April conversation with EDN, Gavrielov discussed his plans for the FPGA maker, which call for a “business model that is scalable” and a major realignment in the way Xilinx addresses its markets and looks at design tool flow.
Further management changes took place in the spring when in April Xilinx appointed AMD veteran Victor Peng as senior VP of its silicon engineering group, a new centralized organization chartered with development and delivery of the company’s flagship silicon platforms, and in May when Xilinx named Sam Rogan as president of Xilinx Japan.
The layoffs also come a day after Xilinx’s competitor Altera Corp updated its Q2 earnings forecast, saying it expects sequential revenue growth to be at the high end of its previous guidance calling for a 1 to 4% increase. In a Lehman Brothers research note this morning from semiconductor market analyst Tim Luke on the Altera mid-quarter update, the Wall Street watching firm said, “Recent checks at foundries suggest generally solid orders from PLDs and [we] believe rival XLNX [Xilinx] may also be seeing at least in line to slightly better trends vs. [the company’s] conservative guide for revenue -1% - +3% quarter over quarter.”
While Xilinx has not issued a mid-quarter update as of yet, the San Jose-based company warned today that it expects to record restructuring-related charges of approximately $18 million to $22 million in connection with the layoffs. Of that, $16 million to $19 million will be for severance pay expenses and will be recorded in the company current quarter, and approximately $2 million to $3 million will be for facility and other associated costs, a portion of which will be recorded in the September quarter.
Xilinx said the restructuring charges will adversely impact its June quarter's operating expenses, which were forecasted to be approximately flat sequentially. The company is slated to report its quarterly results on July 16.
