Semiconductor maker Micron announces 10% staff reduction, suspends bonuses
Micron said it would hit its reduction target through voluntary departures as well as layoffs.
Semiconductor maker Micron
announced Wednesday that it would reduce its headcount by about 10% in 2023, in the latest example of a technology industry slowdown affecting employment.
Shares of Micron fell more than 1% in extended trading.
Idaho-based Micron has about 48,000 employees, according to a recent SEC filing. The company said it would hit its reduction target through voluntary departures as well as layoffs.
Micron also said it is suspending 2023 bonuses.
“On December 21, 2022, we announced a restructure plan in response to challenging industry conditions,” the company said in an SEC filing. “Under the restructure plan, we expect to reduce our headcount by approximately 10% over calendar year 2023, through a combination of voluntary attrition and personnel reductions.”
Micron said it expected a $30 million charge in the current quarter related to the restructuring, which will also include less investment into manufacturing capacity and cost-cutting programs.
The move comes as Micron reported fiscal first-quarter 2023 results where it missed analyst estimates for earnings and revenue, and forecast a larger loss per share than expected in the current quarter.
Here’s how Micron did versus Refinitiv consensus estimates for the quarter ending in December:
Loss per share: $0.04, adjusted, versus $0.01 estimated
Revenues: $4.09 billion versus $4.11 billion estimated
Micron said it expected a loss of 62 cents per share on revenue of $3.8 billion in the current quarter. Analysts had expected guidance of a loss of 30 cents per share on $3.75 billion in sales.
Micron is best known for supplying memory to computer makers, but it is facing an environment where PC sales have already started to slow or shrink, while server sales are expected to show little growth in 2023.
Micron CEO Sanjay Mehrotra said in prepared remarks that there is too much memory supply and not enough demand, which has resulted in the company keeping more inventory and losing pricing power.