SoftBank Group Corp’s chip technology firm Arm Ltd’s China joint venture laid off 90-95 employees last week to cope with a challenging business outlook this year, according to three sources familiar with the situation.
The layoffs come as SoftBank tries to set up a public listing for Arm this year. The China market has been a major source of growth, although a two-year management dispute at the joint venture that resulted in the ousting of the former CEO created some challenges. Two of the sources said those who lost their jobs were mostly engineers in research and development. Before the layoffs, Arm China had about 700 employees; there were no layoffs last year when parent Arm Ltd had global layoffs affecting up to 15% of its workforce, according to one of the sources.
Arm China did not immediately respond to a request for comment after business hours. Last year’s layoffs came after Nvidia Corp failed to take over Arm because of regulatory hurdles. The collapse of the sale marked a major setback for SoftBank’s efforts to generate funds when valuations across its portfolio are under pressure.