Update: In a statement to 9to5Mac, a Qualcomm spokesperson said the following:
As part of the cost reduction plan announced in January, Qualcomm is conducting a reduction of our full-time and temporary workforce.
A workforce reduction, such as this one, affects not only those employees who are part of the reduction, but their families, co-workers and the community. We recognize this and have offered affected employees supportive severance packages to reduce the impact of this transition on them.
We first evaluated non-headcount expense reductions, but we concluded that a workforce reduction is needed to support long-term growth and success, which will ultimately benefit all our stakeholders.
Amid its ongoing legal battle with Apple, Qualcomm is said to be cutting jobs in an effort to reduce costs. A new report from Bloomberg this afternoon says that Qualcomm is cutting its workforce as part of “cost reductions.”
The report explains that Qualcomm is looking to cut costs by $1 billion. It’s unclear at this point how much of its workforce the chipmaker is planning to cut, but the number is said to be high enough that Qualcomm will have to file paperwork with the state of California:
The number of positions being eliminated at the San Diego-based company is large enough that Qualcomm will have to file a so-called WARN notice, or Worker Adjustment and Retraining Notification, with the state of California, one of the people said. Companies are required to make such a filing when they let go of 50 or more employees within a 30-day period. Qualcomm has other major locations in the state and around the world.
Qualcomm’s earnings have taken a hit since its beef with Apple started. During Q4 of 2017, the company reported a 90 percent drop in profit, even pointing out that its numbers were plagued by the Apple legal case.
Apple and its suppliers are said to be withholding royalty payments as the legal case progresses. Qualcomm stated in its earnings press release last November that its numbers were “negatively impacted as a result of actions taken by Apple and its contract manufactures.”
Furthermore, Apple is reportedly planning to drop Qualcomm altogether and produce future iPhone models with only parts from Intel and MediaTek. Such a move would be incredibly detrimental to Qualcomm’s long-term finances.
The battle between Qualcomm and Apple began over a year ago following a complaint from the FTC. That complaint alleged that Qualcomm was forcing Apple to use its baseband chips at higher royalties. Shortly thereafter, Apple got in on the action and filed its own $1 billion lawsuit against the chipmaker.
Qualcomm originally said it had hoped business could continue as usual with Apple throughout the case, but it later ended up filing a countersuit against Apple. Further, Qualcomm requested an import ban on select iPhones in the United States that use Intel’s technology.
Qualcomm has yet to comment on today’s report suggesting job cuts.
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