Conexant Cuts Outlook, Staff


Showing that it is not immune to the economic downturn that has affected its
competitors, chip-maker Conexant Systems Inc. said it has lowered its
second-quarter outlook and has opted to ax 20 percent -- roughly 1,500 -- of its
total work force over the next six months.

On the financial front, Conexant said second-fiscal-quarter revenue will drop
by 35 percent to 40 percent from $410.4 million in the first quarter, citing
languishing inventories and deteriorating digital-cellular handset and
set-top-box markets. That will likely drop pro forma loss per diluted share to
between 35 cents and 40 cents, the company said.

'As inventories are depleted, we expect ordering patterns to return to normal
levels, but we see no clear indications of a recovery at this time,' chairman
and CEO Dwight W. Decker said in a statement.

Regarding cost-cutting, Conexant said it will reduce its work force,
temporarily shutter three wafer-manufacturing and assembly test facilities based
in California and Mexico and reduce capital spending.

Decker said the cost-cutting steps are 'painful,' but 'necessary to position
the company for a return to profitability by the end of the calendar year.'

Zoom Telephonics Inc. and GVC Corp. use Conexant's reference design for their
Data Over Cable Service Interface Specification-certified internal cable