quote:

Despite Billions in Federal Subsidies, Chipmakers Are Laying Off Thousands of Workers
Sissi Cao
4–5 minutes
Micron Technology, Inc.

A growing number of major semiconductor makers are laying off workers amid slowing business in their key markets, despite the U.S. government’s heavy investment in the chip industry and a strong demand for chips in the automobile industry.

Intel, AMD, Nvidia and Qualcomm have all announced layoffs or hiring pauses in recent months. The latest to join the cost-cutting club is Micron Technology, one of the world’s largest manufacturers of memory chips. Micron plans to cut 10 percent of its staff, affecting about 4,800 employees, in 2023 and suspend next year’s bonuses “in response to challenging industry conditions,” the company said in a Securities and Commission filing Dec. 21.

Micron shares fell 5 percent today (Dec. 22) on the news.

Micron saw a “dramatic drop in demand” in the past several months, resulting in the company keeping too much inventory and losing pricing power, CEO Sanjay Mehrotra said on a call with analysts Dec. 21. Before the call, Micron reported a larger-than-expected loss for its first 2023 fiscal quarter ended Dec. 1 and lowered its earnings forecast for the current quarter.

From automobiles to home appliances to computers, many industries faced persistent chip shortages during the pandemic, prompting chipmakers to ramp up production last year. Although some sectors still have a strong demand for chips—automakers, for example, are expected to deal with a chip shortage until at least the end of 2023—slowing consumer demand for personal computers and smartphones are biting into Micron’s chip sales.

Micron is the largest manufacturer of personal computer memory chips in the U.S. It also supplies chips to smartphone makers and automobile companies.

Falling demand for chips for phones and personal computers

In its latest earnings report, Micron predicts its delivery of PC chips this year will fall more than 10 percent and continue to decline in 2023 in the single-digit percentage to near-2019 levels. Its smartphone chip business is also expected to drop about 10 percent this year and remain flat in 2023. The only bright spot is its automobile business, which grew 30 percent in the past quarter and is expected to see “robust growth” in 2023.

While it cuts costs and employees, like many chipmakers, Micron is investing heavily in new technologies and production facilities to take advantage of tax breaks under the CHIPS and Science Act, signed into law by President Joe Biden in August. The bill includes a total of $280 billion in federal subsidies, tax credits and research grants eligible to U.S. and foreign chipmakers over the next decade.

In October, Micron announced a major initiative to build a $20 billion computer chip plant in upstate New York over the next 10 years and plan to spend up to $100 billion to expand it over 20 years. Only weeks earlier, Micron announced the construction of another big factory in Boise, Idaho, near its headquarters.

In September, Intel broke ground on a $20 billion project to build two chip factories in Ohio. Samsung and Texas Instruments have announced large construction projects in Texas. Taiwan’s TSMC, the world’s largest chipmaker, is building a $12 billion factory in Phoenix, Ariz. and recently announced plans to triple its initial investment in the U.S.

However, government incentives couldn’t solve chipmakers’ short-term financial woes. Intel announced in October it has to lay off nearly 200 workers as part of $10 billion cost reduction plan. Qualcomm in November announced a hiring freeze, and Nvidia and AMD are both slowing hiring through the end of the year.

TDepressionEarl posted:

many would criticize basketball in fact of being too individualistic, an irreverence toward authority figures, to the extent that the most famous basketball player of all time is roundly mocked for badly managing the team he purchased.

Some Guy TT posted:

(extremely nonracist voice) they should also stop wearing baggy pants and listening to rap music

Isentropy posted:

unlike America it didn't become an upright parody of itself that forgot the real things that made it great and thought it could just cruise on the rules based international order people playing the game the right way

TDepressionEarl posted:

Some Guy TT posted:

goddamnit i didnt think of that as good avatar material but now i really want it

i dont actually think ur racist earl plz dont be depressed

Some Guy TT posted:

yes but he also appeared in a movie with bugs bunny so its not like he was entirely evil

Palladium posted:

avatar 2 only made $55M so far in china lmao

before you say covid it also made poo poo pretty much everywhere else too

Some Guy TT posted:

im convinced the real reason disney doesnt release their tentpoles in china anymore is because theyre afraid of the bad press if they tank and this certainly supports that interpretation since avatar at least had a decent marketing campaign and a brand people had heard of

Mantis42 posted:

800 million worldwide box office in a week

but okay, go ahead, bet against jim

Bilirubin posted:

can we at least agree that hand egg is the worst sport?

lobster shirt posted:

no it's good

stephenthinkpad posted:

If we are required to use name sports accurately American football should be call Contact Throw.

TDepressionEarl posted:

the most famous basketball player of all time is roundly mocked for badly managing the team he purchased.

lobster shirt posted:

lebron ruined the lakers but he didnt buy them

mila kunis posted:

i think jordan is probably better known worldwide than lebron, primarily due to space jam

mawarannahr posted:

QCS with Chinese characteristics

https://twitter.com/cgmeifangzhang/status/1607421939336843273

Corky Romanovsky posted:

why would china put us at risk like this!

https://mobile.twitter.com/CBSNews/status/1607035945966096385

Chamale posted:

Korean baseball owns because the hitters do baton twirling every time they hit a deep fly ball.

American baseball is getting better about this, but a few years ago if a batter expressed any happiness he could expect to have a grumpy white guy throw a fastball at him.

KirbyKhan posted:

Ping pong was the most serious live sport I ever witnessed.

Atrocious Joe posted:

https://www.youtube.com/watch?v=fTCbpWmPzTY

CRAZY KNUCKLES FAN posted:

do yourself a favor and watch Ping Pong the Animation

Danann posted:

https://observer.com/2022/12/micron-plan-2023-layoff/

chip substitution plan not working out as declared

Truga posted:

it's going to be hilarious when china starts mass exporting their own chips and instantly drives everyone else out of business