Varian Associates said it is implementing a series of corporate cost-cutting and restructuring measures that it anticipates will save $20 million to $30 million annually.
The Palo Alto-based company, which manufactures equipment for the semiconductor, communications and microwave industries, said Tuesday that it is reducing its work force by 5%, implementing a 10% pay cut for its top executives and management staff and authorizing temporary shutdowns among its 26 U.S. plants. It has also ordered a hiring freeze and curtailment of travel and other discretionary expenses.
Additionally, Varian announced some organizational changes as part of a restructuring that follows the departure last month of Varian President Jerome Meyer.
Seen as Positive Step
Analysts viewed the measures as a positive step by the company, which has been troubled by the continuing slump in the semiconductor industry as well as federal spending cutbacks affecting its large military-based programs. Earlier, Varian said it expects to post a pretax loss of $4 million to $10 million for the quarter ended July 4.