Marvell is cutting almost a fifth of its workforce and slashing its mobile business as the US-based chipmaker looks to the IoT to reverse its fortunes.
The company plans to significantly downsize its mobile platforms business in order to focus on “anticipated more profitable opportunities”, in particular those related to connected devices and networking.
The manufacturer said it expects to save $170-220 million (€152-197 million) as a result of the changes, which includes a 17 percent reduction in global headcount.
Marvell revealed the restructuring has already started, with the “major activities” expected to last until the end of its 2016 financial year.
The company added it will continue to pursue Wi-Fi and other wireless technologies needed to support its existing interests.
A statement from the company said: “Marvell announced a significant restructuring of its mobile platform business in order to focus the mobile product line on anticipated more profitable opportunities and right-size its expenses in line with corporate targets.
“As approved by the company’s Board of Directors, the Company plans to significantly downsize the mobile platform organisation to refocus its technology to emerging opportunities in IoT, automotive, and networking.”
Marvell, which according to IHS holds just a 1.1 percent share of the global chipset market, reported revenues of $724 million (€627 million) and profits of $14 million (€12.5 million) in its most recent quarter.
Chipmakers are changing their focus as the mobile SoC market faces increased pressure. In July, Qualcomm announced 15 percent job cuts and plans to save more over $1 billion (€910 million) after its semiconductor business was put under strain by rivals.
Top-tier players are also find themselves under mounting pressure from low-cost rivals.