Logitech to cut 525 salaried employees
- 05 January, 2009 22:00
Logitech will cut 15 percent of its salaried employees as it expects weaker consumer demand for computer peripherals, it said on Tuesday, just a month after shipping its billionth mouse.
The company has 9000 employees, including manufacturing workers in China, with 3500 of those on salary, according to a spokeswoman. The layoffs mean 525 workers will be relieved by the end of March.
Those expected to lose their jobs include managers and product developers, although the spokeswoman would not say how the layoffs will affect Logitech's product offerings. Manufacturing workers will not be reduced as of yet, she said.
Logitech also withdrew its fiscal year 2009 growth targets for operating income and sales. Logitech will update that guidance on Jan. 20, when it releases its results for the third quarter of its fiscal year.
A restructuring charge related to the layoffs will be included in its fourth quarter fiscal 2009 results, with the savings showing up in its first quarter fiscal 2010 results, the company said.
In October, Logitech said it expected fiscal 2009 sales to grow between 6 percent and 8 percent and operating income to grow by 3 percent to 5 percent. Prior to that announcement, Logitech had expected sales and operating income to rise by 15 percent. The changes in the company's projections underscore the rapid deterioration of the world's economy.
The current economic conditions are the most challenging Logitech has ever faced, it said.
However, the company has no debt and a strong cash position and is maintaining market share, it said. Logitech expects to return to double-digit growth when the current economic malaise subsides.
Logitech sells computer mice in more than 100 countries and makes some 376,000 mice a day, the company said in December.
It joins numerous other technology companies bracing for a rough 2009 and shedding workers over the last few months, including Yahoo, AMD, AT&T, Nokia and more.