With the economy struggling and no foreseeable end to the recession in sight, many companies are doing everything they can to keep their heads above water. This usually means cutting back the size of their workforce. After making their financial results for both the fourth quarter and fiscal year public, Marvell Technology Group Ltd. recently announced that they will be doing away with a large number of technology jobs.
The company, which handles storage of communications and consumer silicon solutions, saw a large decline in their revenues for the fourth quarter, according to a recent press release. Earnings dropped 39 percent from $845 million to $513 million. Although net revenue was down for the end of the year, it was up in comparison to fiscal year 2008. Earnings went from $2.89 billion to $2.95 billion, which is an increase of somewhere around 2 percent. Despite the small gain, challenging economic times are causing the company to do away with approximately 850 jobs.
“The results for our fourth quarter reflect the challenging business environment our company, and the world, currently faces,” said Marvell Chairman and Chief Executive Officer Dr. Sehat Sutardja in the press release. “Notwithstanding the challenges we encountered during our fourth quarter, we were able to sustain gross margins, act quickly to lower our operating expenses and generate a healthy free cash flow. However, we believe the current economic climate will not substantially improve over the short term. Consequently, we are taking actions to re-align our business to reflect the realities of the current economic environment. We are focused on improving the operating efficiency of our business and lowering the expenses under our control, while reinforcing the long-term financial strength of Marvell. Our results in our fourth quarter demonstrate initial progress toward these goals.”
The jobs cut will be part of the measures Dr. Sutardja is describing. Altogether the company is cutting approximately 15 percent of its global workforce. According to the press release, Marvell believes that the cost of restructuring and consolidating will end up around $20 million, $14 million of which will go towards severance packages and other employee benefits. The remaining $6 million will be needed for consolidating the factory.
For the time being, displaced workers may have a little bit of trouble finding new jobs. With unemployment on the rise and many employers laying off workers, the demand for labor has been somewhat lower in the last few months.
Tags: Jobs, Technology jobs