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TI may cut 2,000 jobs
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April 17, 2001: 5:51 a.m. ET
Report says that chipmaker's problems worse than suggested in earlier warning
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NEW YORK (CNNfn) - Chipmaker Texas Instruments Inc. is preparing to layoff as many as 2,000 employees due to weakening demand for semiconductors, according to a published report.
The Wall Street Journal, citing unnamed sources familiar with the plans, said the layoff announcement could come as soon as Tuesday. It said the cuts are a sign that Dallas-based company is facing more severe problems than revealed when it warned about results seven weeks ago.
Texas Instruments is set to report first quarter financial results after the market close Tuesday. The company issued its second warning of the year Feb. 26, saying that it expected sales to be off 20 percent from fourth quarter levels, rather than its previous guidance of a 10 percent drop. It also began offering early retirement packages to 2,600 employees at that time, as well as a 30 percent cut in capital spending this year.
Analysts surveyed by earnings tracker First Call forecast that the company, the largest maker of chips used in mobile phones, will report earnings of 16 cents a share, down from 28 cents a share a year earlier, with revenues $2.1 billion, down from $2.7 billion, and below the 20 percent decline from fourth quarter sales forecast by the company.
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The Journal report says the number of layoffs from its worldwide workforce of 42,400 jobs will depend partly on how many employees accepted the voluntary retirement offer, which expired Monday. The company also announced plans last month to close a Santa Cruz, Calif. plant that makes chips used in computer hard-disk drives, eliminating 600 jobs. But the paper said that a company spokeswoman would not comment on any layoff plans or other cost cutting measures beyond those previously announced.
Shares of Texas Instruments (TXN: Research, Estimates) fell $2.44 to close trading Monday at $33.01. 
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