JDSU to Cut 33 Percent of Its Workforce

JDSU (s JDSU), an optical component and test equipment company that once commanded a megabillion-dollar market capitalization (which earned them a place in my book, “Broadbandits”), has fallen on hard times. Despite growing demand for bandwidth and connectivity, JDSU, like many of its peers, has been skating on thin ice. A sharp downturn in demand from the communications sector saw the company miss its second-quarter fiscal 2009 revenue target by six percent; it reported sales of $357 million vs. consensus estimates of $372 million. The company is going to see even further shrinkage, saying it expects revenue for the quarter ending March 28, 2009 to range from $275-$300 million. In order to survive, JDSU needs to make some drastic moves. It’s palming off a factory in China to contract manufacturer Sanmina-SCI. In doing so, JDSU get to slash 2,200 jobs, about a third of its entire employee base, according to RBC Capital Markets’ Mark Sue. About 2,000 of those folks are going to be now working for Sanmina-SCI, doing precisely what they were doing except will not be paid by JDSU. “Another 150 employees ¬†will remain JDSU employees and will focus on corporate functions and product development in the region.¬†Sanmina-SCI will use the same equipment, the same lines, the same people and the same processes as when the fab was under JDSU ownership to support JDSU customers,” a company spokesperson tells us.