Onsemi to cut 1,000 jobs globally

(Reuters) -Onsemi said on Thursday it would cut its global workforce by about 1,000 employees, as the chipmaker looks to streamline its operations and reduce costs.

The company has been struggling with a sluggish recovery in demand for chips in the face of a weak electric vehicles market and excess inventory at its customers.

Onsemi would also consolidate nine sites and reassign an additional 300 employees or ask them to relocate to another site, it said in a regulatory filing.

The company had about 30,000 full-time employees, as of Dec. 31, 2023, according to its latest annual report.

Onsemi supplies chips that go into drive trains of electric cars and help with driver-assistance systems like cameras and sensors. Its silicon carbide chips also help extend the range of electric vehicles.

It expects to incur between $65 million and $80 million in employment-related charges in 2024 and 2025 and complete the process during 2025.

The company plans to reinvest part of the savings generated into some business initiatives and opportunities.

Onsemi had laid off about 1,900 employees in 2023, as part of its efforts to internally manufacture its more profitable chips and save costs by outsourcing other chips.

The company forecast its second-quarter revenue and profit below analysts' estimates in April.

Shares of the company were down marginally in extended trading and have fallen 8.8% so far this year.

(Reporting by Juveria Tabassum; Editing by Shilpi Majumdar)