Qualcomm Employees Lose Jobs
By MICHELLE WILLIAMS Associated Press Writer
SAN DIEGO (AP) - Hundreds of Qualcomm Inc (NasdaqNM:QCOM - news). employees lost their jobs Thursday as part
of the firm's sale of its mobile phone manufacturing unit to Japanese conglomerate Kyocera Corp (NYSE:KYO - news).,
company officials said.
Qualcomm is transferring about 4,000 workers from its consumer productsand personal electronics divisions to Kyocera as
part of the sale, which was announced last month, Qualcomm spokeswoman Christine Trimble said.
Kyocera Wireless Corp., the new division formed by the sale, needed to cut the payroll to make the unit profitable,
spokesman Jay Scovie said.
''Kyocera regrets that we couldn't offer employment to all the employees ... but the reductions were inevitable and necessary
to move the business into a profitable condition,'' Scovie said.
The sale is scheduled to close next month, pending regulatory approval, allowing Kyocera to continue manufacturing at
Qualcomm's San Diego plant without pause, Scovie said.
Trimble said she didn't have the exact number of lost jobs, but said it was less than 1,000. She said an equal number were
transferred or fired, cutting Qualcomm's workforce to 7,000.
''We started the notification process this afternoon,'' Trimble said Thursday. ''We should be finished by tomorrow.''
Most of the permanent and temporary employees in the personal electronics unit, which developed equipment that supported
Qualcomm's wireless phones, were not hired by Kyocera, Trimble said.
Affected employees will receive severance packages and be offered job training, Trimble said. Details were not released.
Trimble said the employees have less than a month left on the job.
As part of the deal, Kyocera agreed to purchase a majority of its semiconductor chip sets over the next five years from
Qualcomm, whose code division multiple access, or CDMA, technology has become the industry standard.
The deal allows Qualcomm to focus on its profitable chip business and technology licensing agreements while helping
Kyocera to begin making consumer phones for the general U.S. market.
Qualcomm's consumer products division has produced more than 14 million phones since it began operations in 1995. Its
customers include AirTouch, Bell Atlantic Mobile, Spring PCS and U.S. West.
The unit had fiscal 1999 revenues of $1.4 billion, more than one-third of the company's overall $3.9 billion in revenue.
Kyocera, which had sales in fiscal year 1999 of $6.1 billion, produces Yashica cameras and laser printers. It is one of two
manufacturers of Iridium satellite phones. |
