National Semiconductor to Sell Units, Cut 500 Jobs

SANTA CLARA, Calif., Feb. 20 -- National Semiconductor Corp. announced today it will immediately eliminate about 500 jobs from its worldwide workforce of 10,000 as it realigns some manufacturing, product development and support personnel in an effort to cut costs.

National said it is seeking to sell its information appliance unit, which primarily consists of the Geode family of products, and its cellular baseband business. The company said it has engaged outside advisers to assist in the process and that it will continue to operate these businesses in the meantime.

National has also entered into a new long-term technology and manufacturing agreement with Taiwan Semiconductor Manufacturing Corp. (TSMC), a provider of CMOS wafer foundry services, to be its supplier of wafers for products with feature sizes at and below 0.15 microns.

"These businesses have an excellent future. But at this point, to achieve that future requires more capital than we are prepared to invest," said Brian L. Halla, National's chairman, president and CEO. "We have cast our nets far and wide, but in this challenging environment we are prioritizing R&D spending on product areas that drive higher returns sooner."

Halla said the company will focus on key growth markets, such as wireless handsets and flat panel displays.

"With TSMC as our foundry partner, National will continue to be able to offer products at leading edge line geometries without having to commit the huge capital required for a 300 mm fab," he said.

For more information, visit: www.national.com