Nanya Technology to lay off workers

By Amy Su and Lisa Wang  /  Staff reporters

Fri, Oct 05, 2012 - Page 13

Nanya Technology Co (南亞科技), the nation’s biggest DRAM chipmaker, said yesterday it was adjusting its workforce and working on new business strategies as sales slid further.

Nanya Technology said the workforce adjustment would affect about 600 employees, or 23 percent of its total workforce, making it the largest layoff ever undertaken by the Formosa Plastics Group (FPG, 台塑集團), which is Nanya Technology’s parent group.

Nanya Technology chairman Wu Chia-chau (吳嘉昭) said more than 400 employees would be assigned to other associated companies within the group, while another 200 would either be laid off, or be persuaded to retire earlier or quit their positions.

“We will transfer some of these employees to the group’s related businesses in the electronic material sector, as many of these engineers have many talents,” Wu told reporters at a press conference.

The company’s human resources rearrangement will be completed by the end of this year, with the number of employees in Nanya Technology set to remain at about 2,000, he said.

Meanwhile, Wu said, the company has to move on from current headwinds in the DRAM industry by reshaping its business strategy and diversifying its products.

Nanya Technology plans to focus on manufacturing specialty memory chips, such as products of consumer electronics DRAM and mobile DRAM, Wu said.

On the other hand, Inotera Memories Inc (華亞科技), a PC DRAM joint venture between Nanya Technology and US memorychip maker Micron Technology Inc, will boost its standard DRAM and server DRAM products, Wu added.

The announcement came a day after smaller rival ProMOS Technologies Inc (茂德) said it was planning to lay off 1,360 employees, or about 94 percent of its total workforce, by the end of the year as part of its financial restructuring to deal with a massive debt load totaling NT$57 billion (US$ 1,94 billion).

The Hsinchu-based chipmaker said it was considering transforming itself into a fabless integrated circuit designer after restructuring.

Nanya Technology yesterday posted a 11.7 percent decline in revenue last month because of lower shipments.

Revenues shrank to NT$1.86 billion last month, compared with NT$2.11 billion in August. That brought last quarter’s revenue to NT$6.55 billion in revenue, down 35 percent from NT$10.1 billion in the second quarter.

Shipments of PC DRAM chips dropped 10 percent month-on-month, bringing the PC DRAM revenue share down to less than 50 percent, the chipmaker said. Chip prices were unchanged last month, thanks to PC demand ahead of China’s weeklong holiday that started on Monday, it said.

Inotera Memories yesterday said revenue slid 2.1 percent to NT$2.8 billion last month, from NT$2.86 billion in August.

Last quarter, Inotera made NT$8.7 billion in revenue, down 9 percent from the second quarter’s NT$9.56 billion.