GSI Technology Announces Strategic Cost Reduction Initiatives
November 30 2022 - 4:05PM
GSI Technology, Inc. (Nasdaq: GSIT), developer of
the Gemini® Associative Processing Unit (APU) for AI and
high-performance parallel computing (HPPC) and a leading provider
of high-performance memory solutions for the networking,
telecommunications and military markets, today announced the
implementation of cost reduction initiatives to better align its
operational structure with its near-term and long term goals for
APU products currently under development.
GSI aims to reduce its operating expenses by approximately $7.0
million on an annualized basis, primarily from salary reductions
related to reduced headcount and salary decreases for certain
retained employees, as well as targeted reductions in research and
development spending. These strategic cost reduction measures are
expected to enable GSI to better focus its operational resources on
advancing its proprietary APU technology.
“GSI’s goal with these cost reduction initiatives is to scale
our operations more appropriately and target investments more
precisely to increase our efficiency,” stated Lee-Lean Shu, GSI
Technology Chairman and Chief Executive Officer. “The launch of
Gemini-I and continued development of Gemini-II remain our primary
priorities while supporting the essential operations of our legacy
SRAM business, including our radiation-hardened and
radiation-tolerant SRAM products.”
None of the Gemini-II chip development and core APU software
development, including the APU compiler, will be affected by the
reduction in R&D spending, and the APU marketing, sales, and
APU engineering efforts will retain priority in the budget. The
planned spending reductions will not impact the launch of Gemini-I
in target markets, including SAR, search, and SaaS.
The cost reduction initiative is expected to be completed by
March 31, 2023 and will result in an approximate 15% decrease in
GSI’s global workforce. GSI expects to incur approximately $850,000
in termination costs, including the payout of accrued vacation,
which will require cash expenditures, most of which are expected to
be incurred in the current fiscal year.
ABOUT GSI TECHNOLOGY
Founded in 1995, GSI Technology, Inc. is a leading provider of
semiconductor memory solutions. GSI's resources are focused on
bringing new products to market that leverage existing core
strengths, including radiation-hardened memory products for extreme
environments and Gemini-I, the associative processing unit designed
to deliver performance advantages for diverse artificial
intelligence applications. GSI Technology is headquartered in
Sunnyvale, California, and has sales offices in the Americas,
Europe, and Asia. For more information, please visit
www.gsitechnology.com.
Forward-Looking Statements
The statements contained in this press release that are not
purely historical are forward-looking statements within the meaning
of Section 21E of the Securities Exchange Act of 1934, as amended,
including statements regarding GSI Technology's expectations,
beliefs, intentions, or strategies regarding the future. All
forward-looking statements included in this press release are based
upon information available to GSI Technology as of the date hereof,
and GSI Technology assumes no obligation to update any such
forward-looking statements. Forward-looking statements involve a
variety of risks and uncertainties, which could cause actual
results to differ materially from those projected. Examples of
risks that could affect our current expectations regarding the cost
reduction initiatives, the resulting expense reductions and our
development of APU products include: our ability to implement the
cost reduction initiatives, the impact of the cost reduction
initiatives on the business and operations of GSI Technology,
including any possible disruption of GSI Technology’s business, and
the failure to realize the anticipated benefits of the cost
reduction initiatives; the rapidly evolving markets for artificial
intelligence and high-performance parallel computing products and
uncertainty regarding the development of these markets; intensive
competition; and delays or unanticipated costs that may be
encountered in the development of new products based on our
in-place associative computing technology and the establishment of
new markets and customer and partner relationships for the sale of
such products. Many of these risks are currently amplified by and
will continue to be amplified by, or in the future may be amplified
by, the COVID-19 global pandemic. Further information regarding
these and other risks relating to GSI Technology's business is
contained in the Company's filings with the Securities and Exchange
Commission, including those factors discussed under the caption
"Risk Factors" in such filings.
Contacts:
Investor RelationsHayden IRKim
Rogers385-831-7337Kim@HaydenIR.com
Media RelationsFinn Partners for GSI
TechnologyRicca Silverio(415) 348-2724gsi@finnpartners.com
CompanyGSI Technology, Inc.Douglas M.
SchirleChief Financial Officer408-331-9802
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