Texas Instruments said Thursday its plans cut 1,700 jobs worldwide as part of a broader restructuring plan to refocus its chip business on embedded markets rather than the increasingly competitive mobile space.
The chip maker's announcement comes just one month after reports suggested it was exploring a sale of its mobile chip business, which produces its OMAP processors for smartphones and tablets. Amazon, which uses Texas Instrument's OMAP processors to power its Kindle Fire tablets, was largely pegged as a potential suitor.
A report from Reuters suggests that Texas Instruments is specifically eyeing the home appliance and automotive embedded markets, as it shifts its focus away from smartphones and tablets. The company's decision to wind down its mobile business likely stems from it struggling to stay competitive, especially as more handset makers, such as Apple and Samsung, choose to build their own processors in-house rather than purchase them from independent chip makers.
Texas Instruments said in a statement that it is already making progress getting its OMAP processors into these new, embedded markets.
"We have a great opportunity to reshape our OMAP processor and wireless connectivity product lines to concentrate on embedded markets," said Greg Delagi, senior vice president of Embedded Processing, at Texas Instruments. "Momentum is already building with new embedded applications and a broad set of customers, and we are accelerating our efforts in these areas."
The Austin, Texas-based company did not specify when the layoffs will occur, but said it expects annualized saving of about $450 million by the end of 2013 as a result of the cuts. Total restructuring charges for the layoffs will be about $325 million, most of which will be accounted for this quarter.
PUBLISHED NOV. 15, 2012