Arm Considering Making 15 Percent of its Workforce Redundant

[TheLostSwede]

After its US$40 billion deal to sell Arm to NVIDIA fell through, it looks like SoftBank is getting ready to tighten the belt over at Arm, to make the company more attractive in time for the planned stock market re-introduction. Arm is said to be looking at making up to 15 percent of its workforce redundant, which is quite a lot of people when you consider that Arm employs some 6,500 people globally. As such, as many as 1,000 people, mainly in the UK and US, are likely to be getting a redundancy notice in the coming months.

At this point in time, it's unclear which divisions at Arm will be the most affected. The official statement from Arm so far, doesn't give any hints. "Like any business, Arm is continually reviewing its business plan to ensure the company has the right balance between opportunities and cost discipline. Unfortunately, this process includes proposed redundancies across Arm's global workforce." With Intel's planned expansion in Europe, there will hopefully be a chance for some of Arm's soon to be former employees to find a job at the competitor.



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[awesomesauce]

boom

 

[ThrashZone]

Hi,
New term for pink slip/ laid off/ fired/ bye bye/...

 

[W1zzard]

So when NVIDIA brings in the $$$ people can stay, but suddenly they are not needed anymore? Weren't they hired for a reason in the first place? Arm's business seems unchanged and thriving?

Maybe dumb politicians can be scared by such announcements

 

[DrCR]

Maybe dumb politicians can be scared by such announcements

That’s an interesting thought. Maybe it is indeed just posturing. My first thought was that this is simply the result of a private company going public—what makes sense long term gets sacrificed for chasing quarterly results, and when that eventually falls apart, the sacked management walks away with millions.

 

[sith'ari]

1000 soon-to -be unemployed famillies ...
well i'm confident that those Regulators who strived to block the nVIDIA/ARM deal ,they will also .. "strive" to find those people a new job ,so sad , things could have been totally different for those people with nVIDIA's billions thrown at ARM R&D.
--P.S. :Unlike ARM's employees , ATi 's employees had been more fortunate since no Regulators opposed -back then- AMD from gaining control of both the CPU I.P. & GPU I.P. when they allowed them to buy-out ATi and use ATi's I.P. for their own benefit
(unlike nVIDIA who would keep the licensing business model for the ARM I.P. )
Oh well...

 

[TheLostSwede]

So when NVIDIA brings in the $$$ people can stay, but suddenly they are not needed anymore? Weren't they hired for a reason in the first place? Arm's business seems unchanged and thriving?

Maybe dumb politicians can be scared by such announcements

It's all to woo potential investors, nothing else. Fewer staff = lower costs = more profit.

 

[Denver]

Given the meaning of the word, I don't understand how "Notice of dismissal of employees, became notice of redundancy".

Btw... I understand it's all about keeping the margins high and showing good numbers when going public. But it still sucks.

 

[W1zzard]

It's all to woo potential investors, nothing else. Fewer staff = lower costs.

Is there even any potential investors for Arm? Also not seeing why anyone should even pay $10B for them, given all the regulatory strings that will be attached

Edit: Softbank market cap is USD 65B and they have investments in a gazillion other companies

 

[ThrashZone]

Hi,
Seems a lot like big companies
To many managers and not enough worker bees

 

[TheLostSwede]

Is there even any potential investors for Arm? Also not seeing why anyone should even pay $10B for them, given all the regulatory strings that will be attached

Edit: Softbank market cap is USD 65B and they have investments in a gazillion other companies

Well, Softbank seems to think so, but I guess we'll have to wait and see.

Given the meaning of the word, I don't understand how "Notice of dismissal of employees, became notice of redundancy".

Btw... I understand it's all about keeping the margins high and showing good numbers when going public. But it still sucks.

Redundancy in most countries means that your employer has to negotiate with you, or at least with the union who represents you, about a severance package.
Being dismissed doesn't include that option in many cases, as that often means you didn't meet the requirements for redundancy or you were fired.
Also, getting a redundancy notice doesn't mean you'll automatically lose your job, you could also be placed in a different role within the company, they just don't need your services in your current position, although that seems unlikely in this case.

 

[zlobby]

Hi,
New term for pink slip/ laid off/ fired/ bye bye/...

I bet you haven't heard about 'efficiency optimization' or 'operational excellence'? There are many terms for the same thing.

As sad as it is, that's how companies operate - when they need workfore, they hire it; when they don't, they fire it.

 

[renz496]

So when NVIDIA brings in the $$$ people can stay, but suddenly they are not needed anymore? Weren't they hired for a reason in the first place? Arm's business seems unchanged and thriving?

Maybe dumb politicians can be scared by such announcements

if ARM are thriving Softbank probably not going to look for buyer in the first place.

 

[DrCR]

if ARM are thriving Softbank probably not going to look for buyer in the first place.

ARM is basically dividend stock at this point. SoftBank apparently simply doesn’t want their money tied up with what ARM has become but instead put towards the (potentially) next big thing. Different investors want different things.

 

[toilet pepper]

Is ARM not profitable? There should be a cap to corporate greed.

 

[ThrashZone]

Hi,
Maybe nvidia will change their mind now that they don't have to be the bad guys laying off 15% workforce.

 

[DeathtoGnomes]

Is there even any potential investors for Arm?

I'd have to say this move is more about posturing specifically for re-entering the open stock market. This announcement is for potential investors in IPO purchases, to make it more appealing showing ARM is aware of its overhead costs. Its really a chess move.

getting a redundancy notice doesn't mean you'll automatically lose your job, you could also be placed in a different role within the company, they just don't need your services in your current position, although that seems unlikely in this case.

My magic 8-ball says that redefining job descriptions could be a part of this too. Dock Supervisor now becomes Shipping and Receiving Engineer.

I've been thru a similar 'redundancy' (a corporate takeover really) a long time ago, its a very stressful time because there is that risk of losing your job. Never did find out how many got the boot.

 

[Garrus]

It's all to woo potential investors, nothing else. Fewer staff = lower costs = more profit.

Take responsibility. This is what you wanted You didn't want ARM to expand massively as a part of nVidia. This is what you get instead. ARM the company has been failing for a long time.

 

[DeathtoGnomes]

You didn't want ARM to expand massively as a part of nVidia.

Pass the Koolaid. Nvidia track record speaks for itself, add in ARM and you can forget about affordable products. Think G sync.

 

[Vayra86]

1000 soon-to -be unemployed famillies ...
well i'm confident that those Regulators who strived to block the nVIDIA/ARM deal ,they will also .. "strive" to find those people a new job ,so sad , things could have been totally different for those people with nVIDIA's billions thrown at ARM R&D.
--P.S. :Unlike ARM's employees , ATi 's employees had been more fortunate since no Regulators opposed -back then- AMD from gaining control of both the CPU I.P. & GPU I.P. when they allowed them to buy-out ATi and use ATi's I.P. for their own benefit
(unlike nVIDIA who would keep the licensing business model for the ARM I.P. )
Oh well...

Lol unemployed as a capable IT guy in the ARM business?

How? I mean you'd have to be blind, stupid and oblivious all at the same time for that. And even if you are... IT is in high demand everywhere and code is code. Heck they're even pulling people from other sectors into IT right now. Actively, as in, companies paying your college/courses to go do it.

This is an utter non issue. ARM is too big to fail.. and Softbank is making a short term mistake with long term consequences. Everyone is struggling to keep their personnel on board. They probably won't get em back.

 

[Valantar]

1000 soon-to -be unemployed famillies ...
well i'm confident that those Regulators who strived to block the nVIDIA/ARM deal ,they will also .. "strive" to find those people a new job ,so sad , things could have been totally different for those people with nVIDIA's billions thrown at ARM R&D.
--P.S. :Unlike ARM's employees , ATi 's employees had been more fortunate since no Regulators opposed -back then- AMD from gaining control of both the CPU I.P. & GPU I.P. when they allowed them to buy-out ATi and use ATi's I.P. for their own benefit
(unlike nVIDIA who would keep the licensing business model for the ARM I.P. )
Oh well...

Maybe place blame where it's due - with the leadership of a massively profitable silicon architecture design corporation that suddenly decides to throw a tantrum because they didn't get their merger fantasy approved?

 

[TheUn4seen]

"Dismissal" means "GTFO now!". "Redundancy" means "Engineer, eh? This here paper says we have too many of you so now you're a doorman working for 10% of your previous salary. If you don't agree to the new employment terms, give us your resignation". In other words, it's a way for the company to avoid paying severance because, formally, they offered the employee a way to remain employed and it's the employee who declined further employment. Most employees won't go to the court and fight it simply because they don't even know such possibility exists and others can't afford the time and cost of such action. It's all about reducing costs and improving numbers before going public.

(...) There should be a cap to corporate greed.

This statement is internally contradictory. Corporations exist only to fuel greed. Sure, they started as a way of coordinating complex undertakings, but this purpose is long lost.

 

[Valantar]

Corporations exist only to fuel greed. Sure, they started as a way of coordinating complex undertakings, but this purpose is long lost.

Well, we could always try to bring that back. One can dream, I suppose.

 

[W1zzard]

I'd have to say this move is more about posturing specifically for re-entering the open stock market. This announcement is for potential investors in IPO purchases, to make it more appealing showing ARM is aware of its overhead costs. Its really a chess move.

But what P/E ratio do they expect from an IPO ? Does anyone believe Arm is the next Tesla or NVIDIA to justify PE over 40? iirc Arm is making like $500M a year

 

[lexluthermiester]

Softbank seems to be acting like a bear with a sore head or teenager throwing a tantrum. Tells me they need to grow up and that ARM would indeed be better off NOT a part of Softbank. ARM(and the world) would likely be best served by her majesty's government bringing the company back under UK ownership where sensible business management can take place.