ARM Holdings to decimate workforce

By Alun Williams

Posted on 15 Oct 2002 at 12:31

One in ten employees facing axe as sales decline for embedded microprocessor company.

ARM Holdings, which specialises in embedded microprocessor systems, has announced its fourth quarter results for 2002. While remaining in the black - to the tune of a pre-tax profit of £8.0 million - sales revenues have declined 11 per cent to £33.3m.

Furthermore, the outlook looks bleak for the Cambridge-based chipmaker. 'In anticipation of an uncertain outlook for revenues in the medium term, we will be managing our cost base tightly,' said the company in an official statement. This translates to large job lay-offs.

By cutting 10 per cent of its workforce, the company is expecting to reduce employee costs by approximately £5m per year. 'Following this reduction, our total headcount will be at a similar level to a year ago. We believe that this level is more appropriate given the current industry outlook.' said the statement.

The company has UK offices in Blackburn, Maidenhead and Sheffield, in addition to the HQ in the Fens.

Warren East, Chief Executive Officer for ARM, remained resilient: 'Even though the length and severity of the current semiconductor industry downturn has now impacted ARM's financial results, we are confident that the company's business model remains robust and resilient,' he said. 'By taking decisive action to reduce our employee costs now, we will be better positioned to benefit from any improvement in market conditions. In the meantime, we will continue to focus on strengthening our competitive position, building on our leadership in the wireless market and increasing our penetration of newer markets.'