LSI Logic cuts 600 jobs, transfers R&D to Oregon from Silicon Valley

MILPITAS, Calif. -- LSI Logic Corp. today announced it will eliminate 600 jobs, or 8% of its workforce, as part of a restructuring of manufacturing operations and the transfer of process R&D from Santa Clara, Calif., to Gresham, Ore. The Santa Clara R&D facility will be shutdown at the end of October.

The Milpitas-based chip company will have 6,900 employees worldwide after this new round of layoffs, a spokesman told SBN. LSI Logic plans to take additional charges against earnings to cover the layoffs in its current quarter.

LSI Logic today also reiterated that it expects third-quarter revenues to decline sequentially by 10-t0-15% from $465 million in Q2. The company also said it continues to anticipate a loss of $0.31 per diluted share in Q3 before charges and goodwill amortization.

Last April, LSI Logic announced it was closing an 8-inch wafer fab in Colorado Springs, Colo., and reducing its workforce by 500 jobs, or 7%, as part of a plan to restructure manufacturing operations. At the time the company said it was consolidating manufacturing capacity at our two major sites in Gresham, Ore., and Tsukuba, Japan (see April 11 story), but today new cuts were announced.

"With the structural changes underway and considering the business climate, we believe this is the time to reassess our manufacturing strategy," said the company spokesman.

About 230 jobs are being eliminated with the transfer of R&D to Gresham. The remaining cuts are being mostly made in worldwide operations at LSI Logic.