Seagate To Slash 3 Per Cent Of Its Workforce
Hard disk maker Seagate Technology said it would cut about 1,600 jobs, or 3 per cent of its workforce, as part of a restructuring plan to reduce costs. An announcement that follows disappointing results for the third quarter ended April 1 and a round of job cuts last year.
The Cupertino, Calif., company is a top producer of drives that store data in personal computers, a market that has declined. It has developed products in newer sectors such as cloud storage, and bought Dot Hill Systems Corp. in October for about $696 million to enhance its cloud offerings according to the wall street journal
Seagate said the plan, which it expects to complete by the end of the September quarter, is likely to result in total pre-tax charges of $62 million.The charges will be accounted for mainly in Seagate’s fourth-quarter results, the company said.
The restructuring would result in about $100 million in savings on an annual run rate basis, the company said.
The company, which has about 52,000 employees worldwide, had said in September it would cut 1,050 jobs.Seagate’s revenue declined in the past five quarters due to weak demand from original equipment manufacturers, including personal computers makers.
The company’s shares closed up 6.3 per cent at $23.95 in regular trading on Wednesday. The stock had fallen nearly 35 per cent this year through Wednesday’s close.
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