No surprises here,Orange County’s biggest makers of computer products shed more than 500 jobs in the past year as consumers and businesses have halted technology spending and companies look to cut costs.
The largest 25 computer products companies here cut local workers 7% in the past year to 7,270 people, according to this week’s Business Journal list.
Three companies were up in workers, seven reported declines and three were flat. The list includes estimates for 12 companies.
No. 1 Western Digital Corp., a Lake Forest-based disk drive maker, was one of the three companies to buck the overall trend, adding jobs for the second year in a row.
The company added 150 workers to its local ranks with its $65 million acquisition in April of Aliso Viejo’s SilconSystems Inc., a maker of drives made of flash memory chips with no moving parts.
SiliconSystems was folded into a newly minted division of Western Digital with founder and former chief executive Michael Hajeck running it as a vice president and general manager.
No. 4 Irvine’s Toshiba America Infor-mation Systems Inc., which designs laptops, storage devices and other office gear, was flat in its hiring.
In February, the company’s Tokyo-based parent Toshiba Corp. agreed to buy Fujitsu Ltd.’s disk drive business, a deal that stands to make Toshiba the biggest maker of drives used in laptops.
Toshiba has both a laptop division and a storage drive division based here in Irvine.
It’s still unclear how the Fujitsu buy will affect local operations.
Its laptop business still is performing well despite the recession,
said Christopher Harrington, vice president of strategy and business development.
The company has eked out a 1% gain in market share over competitors and recently reached a milestone of having shipped 1 million laptops during a single quarter, Harrington said.
Job Cuts
A few companies on the list continued to cut local jobs for the second consecutive year.
No. 13 Quantum Corp., a maker of backup tape systems and software for networks that’s headquartered in San Jose, cut 80 jobs at its Irvine offices as part of a big restructuring.
“We made some cutbacks on expenses companywide,” said spokesman Brad Cohen.
The moves “reflect a shift of investment from some activities that were in Irvine to other places,” he said.
A few years ago the company closed its Costa Mesa plant and moved about 70 jobs to another campus in Colorado Springs, Colo.
Quantum Corp.’s local office still houses some engineering, sales and marketing people.
There are no plans for further job cuts and Irvine “continues to be an important site for the company,” Cohen said.
No. 24 Irvine’s Netlist Inc., a maker of memory boards for servers, routers and broadband switching systems, continued its slide this year.
It slashed nearly half its workers here as memory products ma-kers dealt with a steep falloff in the price of memory chips that hurt sales and squeezed profits.
In an effort to get out of the commo-dity-driven market for chips that go on-to computer memory boards, the company refocused its business on more specialized, custom chips that get better profits.
“Due to a collapse beginning in 2007 of the memory chip market, Netlist began in 2009 to migrate away from the commoditized memory module market,” said spokesman Len Hall. “As a result, revenue levels are being impacted and the company has cut costs and continues to aggressively manage overhead to remain strong during this transitional period.”
Last year, Netlist also cut nearly half of its workers.
During the first quarter, Netlist reported sales of $2 million, down 85% from a year earlier.
“The decline in revenue was driven by a sharp reduction in de-mand from the current customer base, a ramp down of certain projects and the slower-than-expected growth in sales of flash memory products,” the company said.
Netlist stayed mired in red ink. It saw a loss of $4 million, widened from the $584,000 it lost a year earlier.
The global memory chip market is projected to see a 17% drop in revenue this year, according to Stamford, Conn.-based market tracker Gartner Inc.
Netlist last week got a warning letter from the Nasdaq exchange for not having enough independent directors on its board. Three board members have stepped down since November and the company hasn’t yet found replacements.
The company’s shares have been trading for less than a dollar per share since October on a recent market value of $7 million.
Unisys
No. 10 Mission Viejo’s Unisys Corp., a unit of the Blue Bell, Pa.-based tech consulting company and server maker, shed more than half of its local workforce.
Unisys cut nearly 300 jobs for a total of 260 workers here and fell five spots on the list.
That comes on the heels of a 200 job reduction last year as part of a restructuring
that combined its server group units in Mission Viejo and north San Diego’s Rancho Bernardo.
The move was part of a shift in focus for the company, which is pushing customers away from big mainframe computers to smaller, powerful servers built around Intel Corp. chips.
This year, the economy was to blame.
“The reductions were part of a series of worldwide actions to simplify Unisys’ organization and reduce costs in a very challenging economic environment,” said spokesman Brian Daly.
Unisys once had a bigger operation in OC, counting as many as 1,300 workers. It ranked as the second largest computer products maker in the county in the mid-1990s.
No. 3 Cisco Systems Inc. has made Irvine the headquarters for its consumer electronics group and picked up a new executive to run it.
Michael Pocock, who was handpicked by Cisco to run Linksys as a standalone unit, is out.
Cisco recently closed its $590 million acquisition of San Francisco’s Pure Digital Technologies Inc., which makes hand-held digital video cameras, and moved the unit to Irvine to form a consumer business division.
Jonathan Kaplan, the chief executive of Pure Digital, now is the top local guy for both Linksys and Pure Digital.
The Business Journal estimates that Cisco has about 750 workers here.
No. 8 Costa Mesa’s Emulex Corp., a maker of electronics for data storage networks, has been front and center in the news during the past month or so as it struggles to fend off a hostile takeover bid by the county’s dominant chipmaker, Irvine’s Broadcom Corp.
Broadcom offered $764 million for Emulex, which has rejected the offer several times.
Emulex cut roughly 30 jobs here as part of a cost-cutting program.
Reorganizing
No. 12 Irvine’s Printronix Inc., a maker of industrial printers for manufacturers and retailers, is still reorganizing after being bought by private equity firm Vector Capital.
It said earlier this year it’s sending the last of its local manufacturing to Mexico but is keeping its headquarters here.
The company counts 220 workers here, down from 293 a year ago.
No. 14 Santa Ana’s SimpleTech Inc., a unit of San Mateo’s Fabrik Inc., changed hands recently when Fabrik was bought by a unit of Tokyo’s Hitachi Ltd.
Hitachi said it plans to keep the company’s SimpleTech branded external storage drives in place. SimpleTech has an estimated 150 workers here.
