Qualcomm says may split itself, cut jobs

The company said it would cut costs by about $1.4 billion and reduce its full-time workforce by 15 percent, in the face of strong competition from China and Taiwan.

Qualcomm's shares fell about 1 percent at $63.50 in after-market trading on Wednesday.

The chipmaker, which has about 30,000 employees worldwide, also said it had agreed with Jana Partners to add two of the hedge fund's nominees to Qualcomm's board.

Jana had been pushing for Qualcomm to spin off its chip business from its highly profitable patent-licensing business.

Qualcomm also said it may return capital to shareholders.

The company is facing intense competition from Taiwan's MediaTek Inc <2454.TW> and a handful of small Chinese companies that specialize in making chips for low-priced phones.

The Wall Street Journal reported on Monday that Qualcomm was considering splitting itself up.

Qualcomm, which makes software and chips used in smartphones, tablets and gaming devices, is known for its Snapdragon processor used in high-end smartphones made by Samsung Electronics Co Ltd <005930.KS>, HTC Corp <2498.TW> and ZTE Corp <000063.SZ>.

Earlier this year, longtime customer Samsung said it would use an internally developed processor for its new Galaxy S6 smartphone instead of Snapdragon.

Qualcomm said it would hire outside financial advisers for its strategic review, which it expected to complete by the end of the year.

The Information website also reported on Monday that the chipmaker was preparing to lay off several thousand employees.

Qualcomm cut its full-year revenue forecast to $24.5 billion-$25.5 billion from $25 billion-$27 billion and cut its adjusted profit forecast to $4.50-$4.70 per share from $4.60-$5.00 per share.

(Reporting by Anya George Tharakan in Bengaluru; Editing by Simon Jennings)