New York: Mobile chip maker Qualcomm has announced a massive restructuring plan that will see the company slashing 15 percent of its global head count and eliminating about USD 1.4 billion in spending as it looks to increase resources in "lower-cost regions".
"Qualcomm has initiated a Strategic Realignment Plan designed to improve execution, enhance financial performance and drive profitable growth as the company works to create sustainable long-term value for stockholders," it said in a statement.
The new plan will include "aggressive right-sizing the cost structure by eliminating approximately USD 1.4 billion in spending, including an approximately USD 300 million reduction in annual share-based compensation grants", it added.
Qualcomm expects to achieve this run-rate by the end of fiscal year 2016.
"We are making fundamental changes to position Qualcomm for improved execution, financial and operating performance," Qualcomm CEO Steve Mollenkopf said.
Full-time headcount will be reduced by approximately 15 percent, which is in alignment with the overall company reductions, he added.
The company did not include details of the geographies that would be impacted and whether India is part of it or not.
Qualcomm has five engineering centres and offices in India in Delhi, Mumbai, Bangalore, Hyderabad and Chennai.
It said these cost initiatives include reductions in headcount and temporary workforce, streamlining the engineering organisation, reducing the number of offices and "increasing the mix of resources in lower-cost regions".
The planned job cuts will impact about 4,700 positions.
The company had over 31,300 employees at the end of fiscal 2014.
The company also has entered into an agreement with JANA Partners, pursuant to which Mark McLaughlin and Tony Vinciquerra have been added to the Board of Directors and a third director to be selected by the company and consented to by JANA will be added promptly.
Qualcomm said it intends to focus its investments in technologies that scale across core smartphone and adjacent growth opportunities, such as modem and other differentiated technologies.
It will focus investments around the highest-return opportunities, including data centres, small cells and certain IoE verticals.