PMC-Sierra Swings an Ax

PMC-Sierra (PMCS Quote) says it is swinging the ax and targeting 175 workers or 15% of the staff.

The Santa Clara, Calif., communications chip maker says the firings will start immediately and are part of an ongoing cost reduction plan. Included in the cuts are two research centers, one in Winnipeg, Manitoba, and Saskatoon, Saskatchewan.

The company says the cost of the layoffs and plan closings will be about $13 million and that overall annual savings will be about $22 million.

"By improving the efficiency of our operations while focusing on our most promising growth opportunities, PMC-Sierra will become more efficient and be in a better position to compete and gain share in our key target market segments," CEO Bob Bailey said in a press release.

The company did not provide numbers, but said that first quarter sales will be somewhere in the middle to high end of its guidance range of $98 million to $105 million.

PMC shares rose 15 cents to $6.45 in postclose trading Thursday.