Santa Clara, Calif.-based Agilent Technologies said today that it will lay off 2,700 employees and suspend its share repurchase program in response to the most severe downturn in the company’s history.
Agilent also said it would resize its electronic measurement business in response to a 30 percent drop in revenue in fiscal 2009. The 30 percent drop is the lowest level in Agilent’s 10-year history.
The company said revenue in Agilent’s semiconductor and board test segment is expected to be down more than 50 percent from last year, and off 65 percent from its peak volume.
"We have been very aggressive to date in addressing the downturn in electronic measurement markets," said Bill Sullivan, Agilent’s president and CEO. "However, business remains severely depressed, and there are no prospects for a meaningful recovery in the foreseeable future. Therefore, we have no choice but to resize our electronic measurement businesses for the realities of the marketplace."
Agilent will reduce its electronic measurement division by an annualized $300 million over the course of the next four quarters, sizing it to achieve a 12 percent operating margin and a 21 percent ROIC at annualized revenues of $2.3 billion.
The company also announced a further restructuring of its semiconductor and board test division to reduce annual costs by an additional $10 million. The restructuring will affect approximately 2,700 employees and have a cash cost of about $160 million. Agilent previously had 19,000 employees.
In order to fully fund the restructuring and to save money in the current economy, Agilent said it was temporarily suspending its share repurchase program until the end of its 2009 fiscal year.
Agilent also announced today the hiring of Ron Nersesian as senior vice president and general manager of the company's Electronic Measurement Group (EMG). Nersesian is currently vice president and general manager of EMG's Wireless Business Unit.