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Broadcom Cuts 2,500 jobs

SAN JOSE, Calif. — Broadcom will lay off about 2,500 employees as part of a decision on June 2 to exit the cellular baseband business for which it could not find a buyer. The news came in a call with financial analysts in which the company essentially reported neither profits nor revenue growth for its latest quarter.

Broadcom will take a $417 million charge, about $150 million of it this quarter, for the restructuring, which will include closing or consolidating 18 offices. “The decision to exit the cellular baseband business puts Broadcom on a path to being a stronger company,” said Broadcom's chief executive Scott McGregor.

The decision underscores the significance of the smartphone market and how it is consolidating into the hands of fewer, larger system and chip makers. The layoffs represent about 20% of Broadcom's 12,400 employees.

For the full story, see EBN sister site EE Times.

— Rick Merritt is the Silicon Valley Bureau Chief of EE Times.

9 comments on “Broadcom Cuts 2,500 jobs

  1. Ashu001
    July 26, 2014

    Rick,

    This is clearly very bad news for not just those employees but also for Consumers who have lost a Valuable & Reliable Supplier here.

    My Question is do you have any idea if the Job Losses are restricted to North.America or spread out across the Globe?

    How much were they expecting for their Baseband Business?

    No chance of a White Knight emerging if ever?

    Cellular Baseband is seeing an incredible amount of Consolidation like really,really fast!

    Are Consumers ready for this Eventuality?

    Many Thanks!

    Ashish.

  2. SunitaT
    July 27, 2014

    First Microsoft letting off 15000+ employees, and now Broadcom following their footsteps. Is this the beginning of a new period of recession? We have seen reports of Toshiba losing market share, and also their partners as well, can't there be some mitigation procedures?

  3. SunitaT
    July 27, 2014

    @Rick: What do you think could be some of the problems related to the dismissal of employees? Do only the low level employees get sacked or does the company sack them on the basis of performance? Also, what kind of job competition can we hope to see when these employees (obviously having more expertise) compete with freshers?

  4. apek
    July 28, 2014

    I am not at all surprised. It is quite expected behavor in monopoly capitalism. Wait for 2015 to dawn…many more layoffs would follow

  5. Ashu001
    July 28, 2014

    Apek,

    More than Monopoly capitalism this just indicates we live in a world which is over-extended(with debt) as well as heavily under the Spell of Excessive Manufacturing Capacity(thank China for that).

    For the Debt,you need to thank the Clowns who run the Federal Reserve,ECB,BoJ,BoE and BoC today.

    If we had real Capitalism in place,there would have been so much Excessive Manufacturing in place in the first place.

    Regards

    Ashish.

  6. Ashu001
    July 28, 2014

    Tirlapur,

    That's primarily why you have Unemployment Insurance in the first place.

    The only remedy for Excess Production(which is what is afflicting most of the Global Electronics industry today) is shutting it down some production(sometimes permanently).

    It needed to happen to reduce Over-Capacity.

     

  7. Ashu001
    July 28, 2014

    Tirlapur,

    In the case of Broadcom it seems like the Whole Division is getting dumped.

    In MSFT its largely(but not restricted to) The Nokia Division which is now much-much smaller thanks to the fact it has lost Market Share to Samsung and other smaller Chinese Manufacturers.

     

  8. Houngbo_Hospice
    July 29, 2014

    @Rich:

    “Shouldn't we be shutting down those programs that only graduate more bodies into this obviously overcrowded field?”

    The semiconductor industry is becoming more competitive and Broadcom is trying to restructure itself in order to become a stronger company. But does that mean the semiconductor industry has become overcrowded? 

  9. Himanshugupta
    July 29, 2014

    @Hospice, i think that semiconductor industry is consolidating as there is intense competition and the margins are getting small. Companies without deep pockets cannot invest in RnD and are forced to carefully choose their investment plan. Though very bad news for semiconductor professionals but this is becoming the nature lately.

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