10:45 AM – According to a new report from GigaOM, mobile chip giant Qualcomm has started to lay off its employees. With constant pressure coming from MediaTek and other low-cost chip suppliers, Qualcomm has forced its hand to start cutting back on jobs to save money.
The San Diego based company is shaking up its upper level management in order to cut costs. Individuals from positions such as Vice-Presidents has seen layoffs. Not only are layoffs are occurring, but many other employees are seeing demotions, which is better than being out of a job.
MediaTek continuously provides chips at a low-cost, which is constantly putting pressure on Qualcomm. Mobile giant Apple is already making its own chips instead of going to Qualcomm to use their chips such as the Snapdragon series. Samsung still uses Qualcomm’s chips, however, the Korean giant has already been making its own designed chips.
Something good must come out of this, right? Qualcomm is making good decision to get rid of high-level employees with big paycheck and not laying off engineers who do a lot of work for the company.
In an earnings call with Wall Street analysts, Qualcomm CEO Dr. Paul Jacobs said:
“In fiscal 2014 we are facing some mix and demand factors which we currently expect will moderate our QCT growth. In light of this we are taking near-term actions company-wide to prioritize investments, stay focused on growth but also control expenses in order to deliver operating profit growth in excess of revenue growth,” Qualcomm chief executive Paul Jacobs said in a conference call.
The company has cut more than 100 jobs so far. Currently, there are about 31,000 employees in the company, but the layoffs may not stop there. Different sources say that these types of activities are common with in the company and there isn’t much need to worry.
What are your thoughts?