After completing the takeover of VMware Inc., Broadcom Inc. has planned to fire almost 1300 employees in California. Broadcom acquired VMware for $61 billion. With the help of this move, the chipmaker moved deeper into the software industry.
According to Bloomberg,
“The cuts will begin Jan. 26 and affect some 1,267 positions, Broadcom said in a submission to the California Employment Development Department. The jobs are located at VMware’s Palo Alto headquarters, which will remain open. The chipmaker is following its usual pattern of eliminating support roles to cut costs in the wake of takeovers.”
Broadcom and its CEO, Hock Tan, have built one of the biggest semiconductor companies in the industry. They have made use of a string of deals that have largely focused on software.
Tan focused on identifying companies that have a strong share of the market but have stunted growth. This led Broadcom to boost its profits and get support from investors. After the purchase of these companies, Tan started consolidating various operations like sales, HR, and other tasks. This way Broadcom started to cut costs while at the same time retaining engineering talent.
After the acquisition, VMware has become the focal point of Broadcom’s software operations. Hock Tan previously built the division after Broadcom purchased CA Technologies and the corporate security business of Symantec Corp.
VMware started its operations in 1988. It quickly pioneered virtualization programs. With these programs, the company made software more efficient for server computers. Before the closing of the transaction, the company had about 38,300 employees all over.
On the other hand, Broadcom Inc. creates chips that companies like Apple Inc., Alphabet Inc. (Google), and others use in their devices.