Logitech to Cut 450 jobs, But More To Come?

Logitech is  cutting 450 jobs globally, as its new President Bracken Darrell attempts to right the ship following three profit warnings. But questions remain whether these layoffs announced late last week will be enough to give Logitech’s restructuring strategy enough time to take hold.

The company is cutting 13 percent of its worldwide workforce, with 100 positions coming from its U.S. operations. The bulk of these stateside jobs, or 90 positions, are from its Silicon Valley office in Newark, Calif., and the rest in Camas, Wash., and Irvine, Calif.

Although Logitech’s spokeswoman Nancy Morrison declined to specify the number of tech positions that are on the chopping block, Reuters says the layoffs are mostly  from “white-collar positions.”

Job cuts at Logitech’s Washington  and Irvine offices are coming from its Music Business Group, says Morrison, while those at the Newark office are falling across a wide range of functions.   CRN reported, however, that LifeSize, Logitech’s videoconferencing division, is being spared.

Restructuring Remedy

Last April, Logitech announced plans to restructure the company, which Darrell will lead as CEO come January when CEO Guerrino de Luca steps down. In announcing the layoffs last week, Darrell said:

“As we announced in April, this organizational streamlining, along with our strategy to deliver fewer but more compelling products, should position Logitech for renewed growth and profitability.”

The trick for Logitech is to generate as much, if not more, revenues and profits with fewer products. By scaling back the breadth of its products, Logitech is putting itself in a precarious position of having to accurately pick which products to bet the bank on. And if it makes a wrong guess and revenues aren’t enough to cover its expenses, more layoffs could later emerge.

Where to Place A Bet?

The company’s careers page describes it as focusing on “PC navigation, gaming, Internet communications, digital music and home-entertainment control,” making it not just a “mouse maker” as Reuters describes it.

Meanwhile, Logitech is also still posting 24 engineering positions, including acoustics, software applications and mechanical engineering and three IT positions. Morrison points out the company is still hiring as part of its restructuring.

 Related Links:
Logitech to cut 450 jobs in cost-saving drive [Reuters]
Logitech To Cut 450 Jobs [CRN]

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