STMicroelectronics Announces 5,000 Job Cuts Over Next 3 Years

Chipmaker STMicroelectronics NV (STM) on Wednesday announced that it expects 5,000 jobs to be reduced over the course of the next three years, including the 2,800 cuts announced earlier this year.

STMicroelectronics shares were up more than 11% at the time of writing.

According to a report by Reuters, STM CEO Jean-Marc Chery said the company expects voluntary attrition of 2,000 employees over this period, trimming the total workforce by 5,000.

The company currently employs 50,000 people worldwide. 

STMicroelectronics said it is in touch with stakeholders and authorities with respect to these cost-cutting measures.

“I do think that one country specifically is harder. And most likely, okay, could delay a little bit our speed of implementation,” Chery said, without explicitly mentioning the country he was referring to.

Of its 2,800 job cuts announced earlier, 1,000 would impact employees in France. The company said at the time that talks with Italian authorities were ongoing, but a Reuters report said the Italian government is pressing for the cuts to be limited to 1,000.

In April, STM reported its first-quarter earnings, with earnings per share of $0.06, falling short of Wall Street estimates of $0.11.

Its revenue came in at $2.52 billion, also falling short of an expected $2.65 billion.

For the second quarter, STM projected a revenue of $2.71 billion, considerably lower than the estimated $2.99 billion.

STM stock has gained over 14% year-to-date, but it is down more than 33% in the past 12 months.

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