said on Thursday that it will temporarily cut employee pay by 10% in response to a recent and dramatic slowing in customer demand, and the company warned of a second-quarter shortfall in revenue.
The electronics and communications equipment company said the pay reductions started for its 200 senior managers on April 1, and will begin for the rest of the workforce on May 1. Agilent expects to end the pay cuts July 31, but the move could be extended to a later date depending on market conditions.
Agilent is also reducing production schedules to fit with incoming orders, which may cause short-term manufacturing closures and "time-off programs."
Shares of Agilent, which is based in Palo Alto, Calif., gained $2.53, or 9%, to $30.62 at the 4 p.m. close of
New York Stock Exchange
"We're trying to avoid across-the-board layoffs in response to cyclical market conditions," the company said in a statement. "We view the economic slowdown as a business cycle, even though it's deepening and broadening. At the present time, we believe this pay reduction is the most appropriate action for us. We value our workforce and need to be ready to meet demand as business conditions improve."
The company said it was no longer able to provide "meaningful guidance for the year" because of uncertainty in the market. Agilent said second-quarter revenue should be less than $2.9 billion. The company is scheduled to report earnings on May 17.