Western Digital slashes 2,500 jobs

 

Gallery

Posted on 17 Dec 2008 at 16:30

Western Digital has slashed 2,500 jobs as demand for hard drives plummets.

The cuts represent around 5% of Western Digital's worldwide headcount, and is one of a number of measures introduced by the company to try and stave off plummeting demand for its desktop, laptop and enterprise hard drives.

Alongside the staff cuts, which are set to affect staff worldwide, the company also plans to close manufacturing plants in Malaysia and Thailand permanently, and cease all production between 20 December and 2 January 2009.

Pay for all of its executives, directors and senior management is also being cut, with CEO John Coyne taking a 33% cut.

The hard drive manufacturer has also revised its 2008 earnings forecast downwards. The company's initial guidance put earnings between $2 billion and $2.15 billion for the year, however the company now believes it will arrive closer to $1.7 billion and $1.8 billion.

The company expects its cost-cutting measures to save it $150 million per year, though there will be an initial charge of $150 million.

"We are taking these actions in order to strengthen our financial position and enhance the ability of our business to withstand an extended period of depressed demand while continuing to invest in the technologies, products and processes required to assure the continued success of our business," Coyne says.

Author: Stuart Turton