Qualcomm to slash jobs and costs

Qualcomm has said it aims to cut costs and jobs and might restructure itself as it delivers a fresh profit warning in the face of rising competition.

The company, best known for its smartphone chips, wants to reduce spending by $1.4bn (£900m), partly through a 15% cut in its workforce.

The US-based firm also delivered its third profit warning of the year.

Qualcomm had been under pressure from major shareholders to make changes in light of rising competition from Asia.

The cost-cutting efforts announced on Wednesday will include culling around 4,500 full-time jobs.

Qualcomm also said it may break itself up.

Shareholder Jana Partners had been pressuring the firm to separate the chip business from the more profitable patent-licensing business.

Losing market share

The company makes chips used in smartphones and tablets, especially the Snapdragon processor found in many mid- and high-end Android devices.

But it has faced increasing competition from Asian manufacturers like Taiwan’s MediaTek or smaller Chinese chipmakers.

Smartphone giant Samsung plans to increasingly use its own processors for its future devices rather than going for the Snapdragon chip.

Qualcomm shares fell more than 20% over the past year and dropped further in Wednesday’s after hour trading.

In a weak revenue forecast, the company had to give its third profit warning of the year.

For the past quarter, the company said its net income fell by 47% with revenue down by 14%, both numbers coming in below expectations.