Cadence Design Slashes 12% of Workforce
SAN FRANCISCO -- In an expected move, Cadence Design Systems (CDNS) - Get Report announced late Wednesday that it would restructure and lay off 12% of its workforce.
The developer of software for the design of semiconductors will eliminate 625 positions over the coming year.
Cadence said it expects to take a pre-tax restructuring charge of $65 million to $70 million, including $48 million in the third quarter of 2008. The company expects the restructuring to reduce annual operating expenses by $150 million.
For the third quarter, analysts were expecting Cadence to post revenue of $239.3 million and a net loss of $27.2 million.
Shares were down 61 cents, or 12.32%, to $4.34 at the close of the trading on Wednesday.
Cadence apparently plans to reduce or discontinue underperforming product lines.
"In creating the restructuring plan, we emphasized those market segments where Cadence enjoys a leadership position," Senior Vice President Charlie Huang said in a statement. "Going forward, we will focus on excelling in our core business areas."
Cadence is undergoing a major transition due to an expected 30% drop in revenue for 2008. Four senior executives, including the chief executive,
, just weeks before the company
disclosed it would restate earnings
for the first two quarters because of an improper recognition of $24 million.
Once the market leader, Cadence has been losing market share to competitors
Synopsys
(SNPS) - Get Report
and
Mentor Graphics
(MENT)
.
