STMicroelectronics to Cut 5,000 Jobs in Next 3 Years

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STMicroelectronics CEO Jean-Marc Chery announced on June 4 that around 5,000 staff members will leave the company over the next three years, including 2,800 job cuts announced earlier this year, reports Reuters.

Chery made his comments at a BNP Paribas event in Paris. He said, besides the 2,800 layoffs, an additional 2,000 employees will leave the Franco-Italian chip maker because of attrition.

Chery said continuing talks with local authorities were the reason for implementation delays, especially in Italy, adding that the company is in touch with stakeholders and authorities regarding the cuts.

STMicroelectronics currently employs 50,000 people around the world, and the French and Italian governments jointly share a 27.5% interest in the company. However, in recent months, the Italian government has been concerned with the company’s downturn in key markets and has accused Chery of insider trading, which STMicro has denied.

Following Chery’s announcement, Italian unions said 1,200 of the redundancies slated for the Agrate plant in the northern region of Lombardy were "unacceptable" and called for an urgent meeting with the Italian government to discuss the situation. In April, the Italian government pushed for the cuts there to be limited to 1,000, according to Reuters.

In April, STMicro’s first-quarter earnings were $0.06 per share, falling short of Wall Street estimates of $0.11. Furthermore, the company’s revenue came in at $2.52 billion, also falling short of an expected $2.65 billion.

However, Chery said on June 4 he saw signs of a market upturn with the company's shares closing up 11.1% at 24.94 euros per share, its biggest one-day gain since late March 2020.