Entropic Lays Off 18% Of Employees
Chip Company Also Suspends Network-Processor Development
Todd Spangler -- Multichannel News, 3/24/2009 5:27:59 PM
Entropic Communications, which makes chips to enable home networks over coaxial cable, this week laid off 55 employees, about 18% of its total workforce.
The cuts will "better position the company to operate in current market and financial conditions and more closely align operating expenses with revenues," Entropic said in a filing Tuesday with the Securities and Exchange Commission.
As part of the restructuring plan, Entropic said, it will close its locations in Nice, France, and Kfar Saba, Israel.
In addition, Entropic has suspended further development of its advanced network processor architecture and an associated product, which was being staffed primarily out of the Israel facility.
The network-processor architecture would have been part of a future product offering from the company for home-networking applications; no revenue was anticipated from such product until late 2011. Instead of developing it in-house, Entropic expects to pursue collaborations or partnerships with third parties.
Entropic expects the restructuring plan to result in cash expenditures of approximately $1.7 million, including about $900,000 of pretax restructuring charges primarily consisting of employee benefit and severance arrangements. Most of the charges will be recorded in the quarter ending March 31.
San Diego-based Entropic is a founding member of Multimedia over Coax Alliance, which has established a standard for coax-based home networking.
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