Broadcom Will Cut 16% of Its Workforce

The cuts are part of a previously announced plan to get back to profitability.
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Communications chipmaker

Broadcom

(BRCM)

said it will let go about 16% of its workforce, or just over 500 employees, as part of a cost-cutting effort aimed at returning the company to profitability.

The company has posted earnings per share losses for six quarters in a row, and is likewise expected to remain in the red for the quarter under way, according to Thomson Financial/First Call.

In early afternoon trading Monday, shares of the company dipped 63 cents, or 3.1%, to $20.01.

News of the layoffs wasn't a surprise. In October, Broadcom announced it planned to cut operating expenses by 10% to 12% from third-quarter levels, with cost reductions getting under way in the December quarter. As part of that effort, the company said it would be reducing the size of its workforce and consolidating facilities.

In a statement detailing the layoffs today, the chipmaker said it hasn't eliminated any of its product lines, but implied that it has delayed product rollouts in some of its softer markets in order to save money.

As of the end of the third quarter, Broadcom's work force totaled 3,067, including contract and temporary employees.