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Industry Th e Mo n T h in RFiCs
anadigics sheds 100 jobs and gifts market share
GaAs chip maker Anadigics has laid off 15% Through 2007 and 2008 Skyworks has Samsung, the principal handset maker that
of its workforce, as its competitors snatch underlined this ability by improving profit shifted its business away from Anadigics –
market share away from the company on the margins six quarters in succession to return and having a leaner cost profile. In the three
back of its manufacturing misfire. $111 million net profit for its fiscal 2008. months that ended on September 27, the
On November 5, 100 employees learned The annual total revenue of $860 million Greensboro-based firm posted total sales
that they would be leaving the Warren, NJ, that produced this profit has also jumped of $271.7 million, up 13% sequentially. And
based company’s global operations within 16% from $742 million in 2007, which itself although RFMD posted an official oper-
days. The head-count reduction will focus produced a $56 million net profit. ating loss of $19 million in the latest quarter,
on areas previously expanded to meet anti- RF Micro Devices also improved its a large portion of that was attributed to the
cipated levels of output, a spokesperson for profitability in the September quarter, after cost of implementing its own restructuring,
Anadigics told Compound Semiconductor. growing its market share – including at which is now complete.
The company emphasized that no prod-
uct lines or ongoing research efforts were
being lost along with the redundancies. The
move will cost Anadigics up to $2.4 million
in severance payments, but will contribute
up to $20 million in annual cost savings.
“This was a difficult decision because of
the impact that it has on people,” said Gilles
Delfassy, chairman and interim CEO, “but
was necessary to return to profitability.”
“In our efforts to accommodate the unpre-
cedented demand for products, we created
increasing inefficiencies in our manufactur-
ing operations, which have further limited
our output,” Delfassy said, commenting on
expansion plans put in place under his pre-
decessor, Bami Bastani. “We are going for
a complete overhaul of our operations to
improve our execution and productivity.”
The move comes as the company slid
backward from peak sales of $80.5 million
in the three months to June, to $58.1 million
in the quarter ended September. This figure
is $4 million below its previous guidance,
thanks to problems in Anadigics’ broad-
band business piling up on top of lost rev-
enues from handset producers.
The company’s high-profile wireless LAN
products previously earned it sole supplier
status with Intel, but this is where the lat-
est problems are focused. Intel has delayed
some orders from Anadigics and has added
a second source of power amplifiers for its
latest Centrino 2 platform.
Despite recording a $15.5 million loss for
the quarter, the chip maker remains confid-
ent that next year it will return to the profit-
ability it lost this quarter. It is now targeting
handsets due for production ramps in 2009.
Meanwhile, Skyworks Solutions has
stormed to a near-doubling of annual profit
as it reaps the benefit of Anadigics’ difficul-
ties. “We’re ramping production with cus-
tomers who experienced some supply chain
disruptions a year ago,” said CEO David
Aldrich. “We are in fact being awarded that
business because we are able to deliver.”
Compound Semiconductor December 2008 7
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