When Freescale Semiconductor named Richard Beyer as CEO on Wednesday, many of my friends at the company felt the faint stirrings of hope. Freescale, which was spun off from Motorola in December 2004, is a kind of wallflower in the chip world.
It has some good products, but it also has some real problems that need solving before it can live up to the expectations set by its $17.6 billion buyout in September 2006. The buyout left Freescale saddled with $9.5 billion in debt. That’s a lot for a company that reported sales of $5.72 billion last year, down from $6.36 billion in 2006.
Freescale has three big problems. The first is that about a quarter of its sales come from its former parent, which is having a tough time all its own. The second is that it’s in so many markets — some of which are growing — while Freescale is standing still. The third and final problem lies in the fact that former CEO Michel Mayer was not the kind of leader needed to take a newly independent company down its own road.
Beyer may solve the third problem if he can step into his job in mid-March, listen to managers and figure out a strategy (likely involving a push to analog) that gets Freescale growing in step (or even ahead of) the markets it dominates.