The chipset maker will reduce its French workforce by about 430 posts, its Asian workforce by 670 and its US force by 120. The company will also move about 600 workers to new positions.
The move came as STMicroelectronics reported a drop in fourth quarter and full year revenue and net income thanks in part to losses in the set-top division.
“Today we are announcing that we will discontinue the development of new platforms and standard products for set-top-box and home gateway. This difficult decision is consistent with our strategy to only participate in sustainable businesses and is due to the significant losses posted by our set-top box business over the past years in an increasingly challenging market,” said president and CEO Carlo Bozotti
ST said that after an extensive review, it had decided to discontinue the development of new platforms and standard products for set-top-box and home gateway products. The company cited the slower than expected market adoption of leading-edge products and increasing competition on low-end boxes, combined with the required high level of R&D investment, as contributing to the significant losses the business had suffered in this area in recent years.
Annualised savings from the move are estimated at US$170 million upon completion and restructuring costs at about US$170 million.