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Applied chips away at sites, work force

Applied Materials, the giant manufacturer of chipmaking equipment, says it is cutting 2,000 positions, or 14 percent of its staff.

Applied Materials, the giant largest manufacturer of chipmaking equipment, announced that it is cutting 2,000 positions, or 14 percent of its staff.

The company said Monday that it will also consolidate some facilities in Santa Clara, Calif., and Austin, Texas, as well as at international locations. The company said 1,400 positions would be cut in North America, with the majority of affected workers to be notified by the end of the current quarter. The remaining 600 positions will be eliminated at the company's international sites, with workers to be notified by the end of the company's fiscal year.

The move is the latest in a series of cuts at the company. In November, Applied said it would slash around 1,750 jobs, with the majority of those cuts at the company's headquarters.

"We believe that the implementation of this plan will position Applied Materials to decisively respond to the fundamental changes taking place in the semiconductor industry and enable us to improve profitability and extend our leadership," CEO James Morgan said in a statement.

The company said it expects to take restructuring charges of up to $425 million (pretax) over the next four quarters, with facilities consolidations accounting for as much as $235 million in charges, and severance and other work-force reduction charges potentially reaching $120 million.

Chipmakers, including Intel, have said they will spend less this year on new gear amid the weak global economy. In January, Applied warned that new orders were falling short of previous estimates.