National Semiconductor quits PC chips; defeat in battle with Intel results in big write-off and layoff of up to 550

Article Abstract:

National Semiconductor Corp. announced its plans to leave the market for personal-computer microprocessors, basically admitting that it can not compete with Intel Corp. The company will sell its Cyrix microprocessor-design unit in Richardson, Texas, and an associated chip plant in South Portland, Maine, and plans to lay off up to 550 employees as part of its restructuring. The firm will take write-offs of $250 million to $300 million in the fiscal fourth quarter for the restructuring and layoffs. Chief Executive Officer Brian Halla had supported the strategy of trying to undercut Intel on prices since the company acquired Cyrix in June 1997, but Cyrix was only able to gain some market share in the low-end chip market and was unable to keep up with the standard quarterly upgrades in its microprocessors that rivals Intel and Advanced Micro Devices Inc. made. Mr. Halla said National Semiconductor will retain the part of Cyrix's business that produces microprocessors for information appliances. For the fiscal third quarter, Cyrix had a loss of $35 million on sales of around $50 million. Analysts approved of the company's move, as its stock rose 21% on the New York Stock Exchange.

United States, Strategy & planning, Product discontinued, Other staff changes & profiles, Management, Human resource management, Mergers, acquisitions and divestments, Microprocessor, Intel Corp., INTC, Market share, Company business management, Company personnel management, Cyrix Corp., CYRX

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New chip by National Semiconductor may drive PC prices to less than $400

Article Abstract:

National Semiconductor today is announcing a new chip that could result in sub-$400 PCs by 1999. The new 'PC on a chip,' which National Semiconductor hopes to prepare for a mass-market audience by Jun 1999, will combine a microprocessor with circuitry of more than 12 additional chips needed to produce a PC. Chmn and CEO Brian Halla said the new chip could power a machine for up to nine hours on a trans-Pacific flight, or eventually create inexpensive and compact appliance-like computers. National Semiconductor expects to develop a chip circuit width of 0.18 microns by the end of 1999, which would allow a single chip to contain as many as 100 million transistors. By comparison, many contemporary 0.35-micron circuits hold about seven million transistors. National is among the companies switching in 1998 to 0.25-micron chips, which are designed to contain roughly 30 million to 50 million transistors.

Product development, Microcontrollers, Microcontroller, Company technology development, Performance improvement, Performance improvement (Computers)

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