Struggling hard drive manufacturer Western Digital Corp said last week that it will cut 2,500 jobs in Singapore, or roughly 60% of its workforce there. The job cuts come as the Irvine, California- based company moves some of its manufacturing operations to Malaysia in an effort to cut costs. Malaysia’s labor costs are estimated to be about one-third of those in Singapore. Western Digital estimates that the actions will result in a one-time restructuring charge of $30m and significant savings in operational expenses, although it would not be more specific.
Last month, the company reported a fourth-quarter net loss of $101.5m on revenue of $709.3m. The results included restructuring charges of $20m stemming from earlier job cuts. Western Digital has complained of brutal competitive pricing in the desktop hard drive industry which has hurt revenue and earnings even as total shipments increase. It shipped 5.7 million drives last quarter, up from 5.1 million in the March quarter. For the full year, the company’s net loss totaled $492.7m on revenue down 21.9% at $2.77bn, up from a loss of $290.2m the year before.
