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National Semiconductor to cut jobs, close plants

Faced with a steep decline in sales, the chipmaker plans to lay off more than 25 percent of its workforce, or 1,725 jobs
Written by Andrew Nusca, Contributor

Faced with a steep decline in sales, chipmaker National Semiconductor said on Thursday that it plans to lay off more than 25 percent of its workforce, or 1,725 jobs.

The company said it will immediately begin trimming 850 positions worldwide in its product, marketing, manufacturing and support businesses. An additional 875 jobs will be lost with the shuttering of facilities in Suzhou, China, and Arlington, Texas, in coming quarters.

The company has about 6,500 employees.

The company said the layoffs will cost $160m (£115m) to $180m in severance and other charges; $130m to $145m is likely to be recorded in this fiscal quarter.

The cuts come after National recorded a 71 percent decline in its third-quarter earnings, posting a profit of $21.1m , or nine cents per share, compared with $72.9m, or 29 cents per share, a year earlier. Sales fell more than one-third to $292m from $453m .

Analysts polled by Thomson Reuters expected a loss of five cents per share on sales of nearly $296m.

"The worldwide recession has impacted National's business as demand has fallen considerably," chief executive Brian L Halla said in a statement.

National Semiconductor said it expects another five percent to 10 percent sequential decline in sales, which would put its fourth-quarter revenue between $263m and $278m. Analysts were expecting revenue of $293m.

Shares of National Semiconductor fell 28 cents, or 2.4 percent, to $11.42 in morning trading.

The company also said its quarterly dividend would remain eight cents per share and will be paid on 14 April to shareholders on record as of 23 March.

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