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November 15, 2012

Texas Instruments to Lay Off 1,700 from Mobile Processor Division

By Tracey E. Schelmetic, TMCnet Contributor

The latest technology company to do a spot of downsizing is Texas Instruments (News - Alert). The company announced this week that it will be eliminating 1,700 jobs, wrapping up its mobile processor business to focus on chips for more profitable markets like cars and home appliances. The layoffs will essentially eliminate five percent of the company’s workforce.

The job eliminations are the follow-up to an announcement in September by the company that it was divesting itself of its mobile investments in the increasingly competitive smartphone and tablet chip business. Analysts suspect that Texas Instruments will seek a buyer for its processor unit, called OMAP, Reuters is reporting today. There had been rumors that Amazon was considering the purchase, since Texas Instruments mobile processes are heavily used in its Kindle line of e-readers and tablet computers.

“A sale would have been better than a restructuring but a restructuring is certainly better than nothing," Sanford Bernstein analyst, Stacy Rasgon told Reuters (News - Alert).

TI is expected to continue selling existing tablet and phone processors for products like Kindle tablets for as long as demand remains, but stop developing new chips, said Reuters.

"This year, the Kindle runs on the OMAP 4 and next year's Kindle is slated, we believe, for OMAP 5. We believe that program is well along to completion and do not expect that the termination of OMAP will disrupt those plans," Longbow Research analyst, JoAnne Feeney told the news agency.

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Edited by Brooke Neuman
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