Net revenues decreased 35% compared to $94.1 million in the second quarter of 2001. PMC-Sierra’s pro forma net loss in the third quarter of 2001 was $26.8 million compared to a pro forma net loss of $13.4 million in the second quarter of 2001.
PMC-Sierra also announced it will be re-focusing its efforts on major customer projects while reducing its cost structure going forward. As a result, the Company will be reducing its workforce by approximately 350 employees beginning today. On September 30 2001, PMC-Sierra had a total of 1,475 employees throughout its worldwide operations. PMC-Sierra expects to record restructuring and other charges related to employee severances, excess facility costs and asset valuation charges in the fourth quarter of 2001.
Our focused development efforts are resulting in more engagement with our major customers and, as a result, we are maintaining strong design win momentum, said Bob Bailey, Chairman and CEO of PMC-Sierra. While expanding our product portfolio we are also reducing a portion of our operating expenses to better size our investments in line with our customers’ needs. This will result in a lower breakeven revenue and is the next step towards a return to solid profitability and earnings growth.
Under Generally Accepted Accounting Principles (GAAP), which includes deferred stock compensation, amortization of goodwill, merger costs, acquisition of in process research and development, and gain on sale of investments, the net loss in the third quarter of 2001 was $34.5 million or $0.20 per share compared to a net loss of $34.6 million or $0.21 per share in the third quarter of 2000. The pro forma net income for the third quarter of 2001 excludes $1.6 million of deferred stock compensation and $6.0 million in amortization of goodwill.
