Broadcom Inc. is set to terminate nearly 1,300 VMware Inc. employees in California following the finalization of a $61 billion acquisition that propelled the chipmaker further into the software sector.
Most Read from Bloomberg
The workforce reductions are scheduled to commence on Jan. 26, impacting roughly 1,267 positions, as stated in Broadcom’s submission to the California Employment Development Department. These job cuts will be focused on VMware’s Palo Alto headquarters, which will remain operational.
As part of its usual practice, the chipmaker is streamlining support roles in a cost-cutting effort post-acquisition. CEO Hock Tan has expanded the semiconductor company via a series of acquisitions, with an increasing emphasis on software.
Tan’s strategy, which has bolstered profits and gained favor among investors, involves identifying companies with significant market share but limited growth prospects. Subsequently, he consolidates operations to reduce expenses while striving to retain engineering talent.
VMware has emerged as a key component of Tan’s software portfolio, following the acquisitions of CA Technologies and Symantec Corp.’s corporate security business.
Founded in 1998, VMware is known for pioneering virtualization programs that optimize server computer utilization. Prior to the completion of the acquisition, the company employed approximately 38,300 individuals.
Broadcom, which also manufactures chips used by tech giants like Apple Inc. and Alphabet Inc.’s Google, is scheduled to announce earnings in the upcoming week.
The San Francisco Chronicle previously reported that Broadcom would cut more than 1,200 workers.
Most Read from Bloomberg Businessweek
©2023 Bloomberg L.P.
