Mobile platform and wireless semiconductor solutions provider ST-Ericsson, which is a 50/50 joint venture of Ericsson (OMX: ERIC B, NASDAQ: ERIC) and STMicroelectronics (NYSE:STM) announced a strategic shift this morning in an effort to reach sustainable profitability. It will be focusing on ModAps for smartphones and tablets aiming to help manufacturers to bring devices quickly to market.
The Genewe, Switzerland headquartered company will focus R&D effort in the development of future application processors in partnership with STMicroelectronics. ST-Ericsson will transfer its application processor R&D activity and employees to STMicroelectronics.
A restructuring program targeting 320 million USD in annual savings will be initiated. It is estimated that 1700 employees will be affected. This includes those who will be moving to STMicroelectronics side. The aim is to also bring down Selling, General and Administrative Expenses by 25%. Restructuring costs are estimated to be between 130 and 150 million U.S. Dollars.
No comments:
Post a Comment