Agere Systems Inc. (Allentown, PA) announced plans to align its cost structure with current revenue expectations and improve profitability. As part of these actions, the company is reducing its workforce by 500 employees across the business, including administrative functions, sales, marketing and product development. With these actions, the company will lower both its costs and operating expenses.
In addition, Agere announced that it would cease operations in its wafer manufacturing facility in Orlando, FL, by the end of December 2005, if a sale of the facility cannot be arranged by that time. In 2002, the company had announced plans to sell this facility as an ongoing operation, but has not yet found a suitable buyer. The facility currently employs approximately 600 people. The company expects cost benefits from the facility closing to begin accruing in fiscal 2006.
The company expects to take total restructuring charges and expenses in the range of $340 million to $360 million associated with these actions, with approximately $130 million to $140 million to be recorded in the fourth quarter of fiscal 2004, ending September 30, and the remainder to be incurred in subsequent quarters.
