STMicroelectronics NV (ST), Europe's largest chipmaker, is in the process of eliminating 2,500 jobs through attrition and layoffs, a company spokeswoman confirmed on Monday.
"The figure relates to a reduction in our workforce mostly by attrition. About 200 people have lost their jobs on an involuntary basis and at most, another 450 people will be laid off," said ST's UK-based spokeswoman, Janice Fenton.
Also on Monday, ST announced additions to its line of enhanced security smart card microcontroller units, called ST19.
Blaming a steep slump in the semiconductor market, the company announced in May that it was closing its wafer fabrication plan in Ottawa, Canada. Of those employees, 450 have been offered relocation, but so far it is unknown how many of those employees will choose to take the offer, Fenton said.
As of July, ST, which is headquartered in St. Genis-Pouilly, France, employed a total of 42,000 people, Fenton said.
In the US, 300 ST employees have already left the company on a voluntary basis, while 200 employees were laid off, Fenton said. More layoffs in the US can be expected, Fenton said.
In July, citing order cancellations in its telecommunication and computer peripheral businesses, the company posted second-quarter revenue of $US1.59 billion, down from $1.88 billion in the same quarter last year. At the time, ST also warned that lower earnings would continue into the third quarter.
ST indicated in July that it expected the industry to bottom out in the third quarter of 2001 with revenue declining by between 10 per cent to 15 per cent from the previous year, and that it expects to see signs of a recovery in the fourth quarter.
Fenton could not immediately say if ST's outlook had changed since July.
ST supplies chips to large players in various parts of the technology industry worldwide with customers including Nokia, LG Electronics and Hewlett-Packard.
Meanwhile, the new ST19 enhanced security smart card microcontroller units announced today included the ST19XR34, the ST19XS08 and the ST19XS04, the company said in a statement. The ST19XR34 features 96K bytes of ROM (Read-Only Memory), 34K bytes of EEPROM (Electronic Erasable Programmable Read-Only Memory) and 4K bytes of RAM; the ST19XS08 has 64K bytes of ROM and 8K bytes of user EEPROM while the ST19XS04 comes with 48K bytes of ROM and 4K bytes of EEPROM. The ST19XS08 and ST19XS04 both carry 1.5K bytes of RAM, ST said.
Trading of ST (STM) on the New York Stock Exchange, was down Monday morning -- the first day of trading since Tuesday's terrorist attack. As of 10:13 a.m. local New York time, ST had lost $3.49 per share, or 13.15 per cent of its value, to trade at $23.05 per share. That is below its previous 52-week low of $25.25 per share and well off of its 52-week high of $55.625 per share.
On the Paris Stock Exchange, by 4:19 p.m. local Paris time, ST (STM.PAR) was up 0.27 euros ($US0.25) per share, or 1.09 per cent to trade at 25.05 euros per share. That is near its 52-week low of 24.78 euros per share and well below its 52-week high of 66 euros per share.