Xilinx to cut 250 jobs; stock jumps
SAN FRANCISCO (Reuters) - Chipmaker Xilinx Inc (XLNX.O) said on Wednesday it would cut about 250 jobs, or 7 percent of its work force. Shares of the company rose more than 4 percent.
Following the news, brokerage firm UBS raised its price target on Xilinx stock $32 from $27 and rated the shares "buy."
Lehman Bros, in turn, raised its price target on Xilinx's chief rival, Altera Corp (ALTR.O), to $24 from $23 and rated the shares "equal weight."
Xilinx, whose programmable chips are used in communications network gear, consumer electronics and industrial equipment, said it would take a restructuring charge of $18 million to $22 million that would increase operating expenses in the current quarter. Previously, it had said such expenses would be little changed from the prior quarter.
In April, Xilinx posted quarterly results that lagged Wall Street expectations and the performance of Altera, and its shares declined.
Also in April, Altera posted higher quarterly profit and forecast earnings in the current quarter that could top analysts' forecasts.
Shares of Xilinx rose $1.16, or 4.3 percent, to $28.08 in morning Nasdaq trade. Altera climbed 91 cents, or nearly 4 percent, to $23.80.
Through Tuesday, Altera shares had climbed 18.5 percent this year, while Xilinx was up 23 percent.
(Reporting Duncan Martell; additional reporting by Kenneth Li in New York; editing by Dave Zimmerman and John Wallace)
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