Cadence Design's ( CDN) Tality unit said it will no longer provide board-level, mechanical and packaging services for data and telecommunications equipment, and will instead focus on communications IC design and intellectual property used in wireline communications equipment.

The company said the action is intended to capitalize on what it expects will be an imminent recovery in the chip sector.

To facilitate the shift, the company plans to cut 200 jobs and take a $25 million restructuring charge in the first quarter.

Shares of CDN closed Friday at $23.09 ahead of the announcement.

More from Technology

Facebook CEO Mark Zuckerberg Deflects Tough Questions From European Parliament

Facebook CEO Mark Zuckerberg Deflects Tough Questions From European Parliament

These 5 Autonomous Driving Stocks Are Flashing Buy Signals

These 5 Autonomous Driving Stocks Are Flashing Buy Signals

10 Seconds To Genius: Facebook

10 Seconds To Genius: Facebook

10 Big Tech Companies Are Spending $100 Billion in 2018 to Dominate Even More

10 Big Tech Companies Are Spending $100 Billion in 2018 to Dominate Even More

ACLU Asks Amazon to Halt Sale of Facial Recognition Software

ACLU Asks Amazon to Halt Sale of Facial Recognition Software