Chip manufacturer Texas Instruments has announced plans to cut 1,100 jobs worldwide, despite a strong growth in profits. The cuts will take place in the US, India and Japan.
Texas Instruments said the cuts would save it $130m by the end of 2014, and most are expected to be in Embedded Processing and in Japan. The announcement came as fourth quarter figures for the firm showed revenues of $3.03bn, and a net profit of $511m.
This represented a two percent increase in revenue for the same period in 2012 and an increase in net profits of 94 percent, as the company saw strong growth in several areas.
Chief executive Richard Templeton, did not comment on the planned job cuts and instead focused on the strong financials as evidence that the company’s focus on analogue and embedded processing markets – ranging from GPS systems, video security cameras and power tools – was paying off.
"Our fourth quarter capped a year in which each quarter's performance increasingly reflected the impact of structural changes we've made to focus Texas Instruments on analog and embedded processing, where the diversity and longevity of our positions are assets,” he said.
“The combined revenue from analog and embedded processing grew 12 percent over last year's fourth quarter and comprised 82 percent of total revenue. Individually, analog was up 12 percent and Embedded Processing was up 11 percent from a year ago.”
Vice president of investor relations at Texas Instruments Ron Slaymaker confirmed that cuts in Japan aimed to ensure areas of growth were given more prominence.
“On one hand, we'll be consolidating some of the business activity that was previously in Japan just to other regions of the world where we can do it more efficiently,” he said on an earnings call.
“But then also we'll be affecting some of the sales and marketing activities in Japan, kind of align those resources with that opportunity that we see in Japan going forward."
The job cuts follows a similar announcement from rival Intel earlier this week, which plans to cut around 5,000 roles in order to streamline operations, as it suffered a drop in revenue and profit for 2013.
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