STMicroelectronics Cutting 4,500 Jobs

Swiss chip maker said Tuesday it is cutting about 9 percent of its worldwide work force after it posted a fourth-quarter net loss Tuesday.

GENEVA (AP) -- Shares in Swiss chip maker STMicroelectronics NV gained 0.4 percent Wednesday after reporting late Tuesday that it will cut about 4,500 jobs worldwide and book a fourth quarter net loss of $366 million.

Shares stood at euro 4.31 ($5.73) on the Paris exchange by mid-afternoon.

The Geneva-based company swung to a net loss of 42 cents per share in the fourth quarter, from a profit of 2 cents per share, or $20 million, in the same period a year earlier.

Revenue fell 17 percent to $2.28 billion from $2.74 billion.

Chief executive Carlo Bozotti said the company was hit by order cancellations and lower demand.

"All product areas were negatively affected, in particular automotive, wireless and computer peripherals," he said in a statement.

Excluding restructuring costs, impairment charges and other items, the quarter's net loss totaled 6 cents per share.

Analysts, on average, were expecting a profit of 3 cents per share on sales of $2.23 billion, according to a poll by Thomson Reuters. Analysts typically exclude one-time items from their estimates.

For the full year, the company posted a net loss of $786 million, or 88 cents per share, compared with a loss of $477 million, or 53 cents per share, a year earlier.

Sales slid less than 2 percent to $9.84 billion from $10 billion.

Looking ahead, STMicro said it is targeting first-quarter sales of $1.5 billion to $1.85 billion. Analysts are predicting $2.06 billion. The company did not provide a forecast for earnings per share.

The company said it plans to reduce costs by more than $700 million in 2009.

Based on the company's 52,180 employees according to CapitalIQ, the job cuts represent about 9 percent of STMicro's global work force.

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