According to filings with the California Employment Development Department, Qualcomm is set to reduce its workforce by 1,258 employees in two California offices.
Specifically, the chip company disclosed that 1,064 positions will be phased out in San Diego, where its headquarters is located, and an additional 194 jobs will be discontinued at its Santa Clara offices.
At present, Qualcomm maintains a workforce of over 51,000 employees, which means that this reduction amounts to approximately 2.5% of its total workforce. The primary driver behind these job cuts is a decrease in revenue, primarily stemming from a sluggish performance in the company’s chip business during the third fiscal quarter.
According to Qualcomm’s filing, the positions will be vacated by December 13, and the company also disclosed plans for further restructuring. These initiatives will take effect during the fourth quarter of fiscal 2023, marking the start of calendar year 2024.
Qualcomm is grappling with declining revenues, primarily attributed to the persistent uncertainty in the macroeconomic and demand landscape.
In a related development, analyst Ming-Chi Kuo recently revealed that Qualcomm might face the potential loss of a significant client in the form of Huawei. In 2023, the Chinese manufacturer procured over 40 million SoCs from Qualcomm, but it is transitioning towards local partners for its 2024 and future requirements.
It has been reported that Qualcomm could lose up to $10.8 billion after cutting ties with Huawei. The Chinese phone maker purchased 20 million chips from Qualcomm in 2022 and over 40 million this year.
It remains to be seen how Qualcomm will manage to circumvent losing one of its biggest customers.
