Low-power chip design company ARM has reduced its UK staff by 20%. The move goes against a hiring promise SoftBank made to the UK government when it bought the tech company in 2016.
ARM makes money by selling licenses to other companies like Apple and Samsung to make its chips, but doesn't make any of its own, and it is increasingly interested in its processors: low-power development boards like the Raspberry Pi and The rise of its many alternatives, Apple's M-series of Apple Silicon taking the computing world by storm, and higher-power Qualcomm chips appearing in laptops and high-end smartphones.
The 18% of global staff layoffs appear to be falling more on UK workers than workers in other countries. The rest of the world saw 550 fewer employees, but 700 jobs were terminated in the UK. In the UK, ARM has 3,500 employees but is now down to 2,800 after layoffs. The move comes after a failed takeover by Nvidia that valued the company at $66 billion. ARM's chief executive, Rene Haas, recently welcomed the update to the company's board of directors, having previously said the company needs to avoid duplication of effort, control work on non-critical projects, and implement stricter management of overhead.
The move, however, has drawn the ire of UK union Unite, which in March called for a moratorium on layoffs so that a financial check could find out if the company really needed to cut jobs, in the nine-month period to December 31, 2021. The net income was just over 2 billion US dollars (about 14.16 billion yuan), but the profit was only 260,000 US dollars (about 1.841 million yuan). A statement from an ARM spokesperson at the time suggested that "12%-15%" of employees could be affected. SoftBank itself reported a huge loss of $23.4 billion in the first quarter of fiscal 2023 (starting on September 1, 2022) due to a huge write-down of investment valuations.
SoftBank pledged to double its workforce when it took over Britain's ARM in 2016 and has achieved that by hiring 1,730 new workers, bringing the UK workforce to 3,500. Today's announcement shows that 40% of those employees were laid off.
ARM, which is expected to go public but has yet to announce an IPO, has posted 373 jobs in the UK, most of them engineering roles.
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