QLogic Announces Restructuring Plan
ALISO VIEJO, Calif. -- June 4, 2013
QLogic today announced it is implementing a restructuring plan designed to
streamline business operations with the goal of driving long-term profitable
growth. The restructuring plan includes a workforce reduction, the
consolidation of several engineering activities, and enhanced product
development focus. These restructuring activities are part of an overall plan
to deliver greater value to customers and shareholders, while accelerating
QLogic anticipates the restructuring actions will be substantially completed
within the next twelve months. Once fully implemented, the company expects the
restructuring actions will achieve annualized cash savings of approximately
$20 million, primarily in operating expenses. QLogic has plans to reinvest
part of these savings in the development of new products and programs.
“These restructuring activities represent decisive steps designed to maximize
engineering efficiencies, optimize business operations and align our
investments with customer requirements,” said Jean Hu, interim chief executive
officer and chief financial officer, QLogic.
The company estimates that it will incur pre-tax GAAP charges between $20
million and $23 million in connection with these restructuring actions, the
majority of which will be recorded during the first half of fiscal year 2014.
The company reaffirms its previously announced non-GAAP financial guidance for
the first quarter of fiscal year 2014.
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QLogic – the Ultimate in Performance
QLogic (Nasdaq: QLGC) is a global leader and technology innovator in high
performance networking. Leading OEMs and channel partners worldwide rely on
QLogic products for their data, storage and server networking solutions. For
more information, visit www.qlogic.com.
Disclaimer – Forward-Looking Statements
This press release contains statements relating to future results of the
company (including certain beliefs and projections regarding business and
market trends) that are "forward-looking statements" as defined in the Private
Securities Litigation Reform Act of 1995. Such forward-looking statements are
subject to risks and uncertainties that could cause actual results to differ
materially from those projected or implied in the forward-looking statements.
The company advises readers that these potential risks and uncertainties
include, but are not limited to: uncertainty as to whether the restructuring
plan will achieve the expected goals and results; uncertainty as to whether
the company will achieve the expected operating expense reductions;
unfavorable economic conditions; potential fluctuations in operating results;
gross margins that may vary over time; the stock price of the company may be
volatile; the company's dependence on the networking markets served; the
ability to maintain and gain market or industry acceptance of the company's
products; the company's dependence on a small number of customers; the
company's ability to compete effectively with other companies; the ability to
attract and retain key personnel; the complexity of the company's products;
declining average unit sales prices of comparable products; the company's
dependence on sole source and limited source suppliers; the company's
dependence on relationships with certain third-party subcontractors and
contract manufacturers; sales fluctuations arising from customer transitions
to new products; seasonal fluctuations and uneven sales patterns in orders
from customers; a reduction in sales efforts by current distributors; changes
in the company's tax provisions or adverse outcomes resulting from examination
of its income tax returns; international economic, currency, regulatory,
political and other risks; facilities of the company and its suppliers and
customers are located in areas subject to natural disasters; the ability to
protect proprietary rights; the ability to satisfactorily resolve any
infringement claims; uncertain benefits from strategic business combinations,
acquisitions and divestitures; declines in the market value of the company's
marketable securities; changes in and compliance with regulations;
difficulties in transitioning to smaller geometry process technologies; the
use of "open source" software in the company's products; system security
risks, data protection breaches and cyber-attacks; and the company’s ability
to borrow under its credit agreement is subject to certain covenants.
More detailed information on these and additional factors which could affect
the company's operating and financial results are described in the company's
Forms 10-K, 10-Q and other reports filed, or to be filed, with the Securities
and Exchange Commission. The company urges all interested parties to read
these reports to gain a better understanding of the business and other risks
that the company faces. The forward-looking statements contained in this press
release are made only as of the date hereof, and the company does not intend
to update or revise these forward-looking statements, whether as a result of
new information, future events or otherwise.
QLogic and the QLogic logo are registered trademarks of QLogic Corporation.
Other trademarks and registered trademarks are the property of the companies
with which they are associated.
Steve Sturgeon, 858-472-5669
Jean Hu, 949-389-7579
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