Qualcomm to Cut Jobs Amidst Cost Restructuring
Qualcomm today said it will pursue aggressive cost restructuring, including the elimination of jobs, as it seeks to balance its financials. Qualcomm indicated it plans to slash $1.4 billion in expenses through a number of different actions, including job cuts of about 4,500, or 15% of its work force. Other cost reductions will include a reduction in the amount grants given each year by $300 million; a review of alternatives to its corporate structure; a return of capital to stockholders; additions to its board of directors; a revamp of its compensation plans; and more discipline in its investments. As part of its restructuring efforts, Qualcomm said it will review the possibility of breaking into multiple different companies, each with its own focus. This follows a call to action from activist investors that wish to see the company divided into parts. "The actions we are taking today are designed to ensure that we are properly structured to seize these opportunities while delivering improved near-term performance," said Steve Mollenkopf, CEO of Qualcomm. "I have great confidence in our employees and our ability to implement this new plan and I look forward to providing our stockholders with quarterly updates on our progress." Qualcomm didn't immediately specify where it will focus job cuts.
Qualcomm Weighing Potential Breakup and Job Cuts
Qualcomm is preparing to conduct an in-depth review of its corporate strategy that could lead to the company breaking into several separate entities, reports the Wall Street Journal. Activist investors have begun to push Qualcomm towards a possible split, which would see the company's chip-production and patent-licensing businesses pulled apart.
Broadcom Lowers Offer for Qualcomm, Qualcomm Says No Way
Broadcom revised its offer to acquire Qualcomm downward by $3 per share after Qualcomm increased its own bid to buy NXP Semiconductors. Broadcom said, "Qualcomm's board acted against the best interests of its stockholders by unilaterally transferring excessive value to NXP's activist stockholders." Broadcom would have preferred to see Qualcomm act together with Broadcom to broker the right deal for NXP while still allowing Broadcom to move forward with its own offer to buy Qualcomm.
Broadcom Proposes to Oust Qualcomm's Board
Broadcom today suggested Qualcomm's shareholders elect an entirely new board of directors during the latter's planned annual shareholder meeting on March 6, 2018. Broadcom took the opportunity to nominate 11 people to replace Qualcomm's board.
Qualcomm Decides to Remain As Is
Qualcomm has completed a review of its corporate structure and said it will not make any changes to its makeup and/or organization. The company was examining whether or not it would make sense to break the company up into separate parts to unlock more value for shareholders.
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