In a memo reviewed by Reuters, Qualcomm CEO Cristiano Amon announced a global job reduction initiative aimed at fostering a stronger performance culture within the company. The layoffs will begin in November, although the memo did not specify the number of positions to be eliminated.
Qualcomm, which employed approximately 52,000 people as of September last year, is facing challenges due to a downturn in consumer electronics sales, exacerbated by rising memory prices. This year, Qualcomm's stock has only increased by 1.5%, significantly lagging behind the S&P 500's 12% gain and the Philadelphia Semiconductor Index's nearly 60% rise.
In its latest earnings report, Qualcomm projected quarterly profits below expectations and indicated a faster-than-anticipated decline in revenue from Apple products. However, the company is optimistic about growth in its data-center and non-handset businesses, anticipating that these sectors will compensate for lost smartphone revenue by fiscal 2027.
Amon emphasized that the layoffs will consider business priorities and the necessary skills for future success, highlighting the need for the right talent in key roles as Qualcomm seeks to expand into the AI data-center market