Breaking: Applied Materials and Silicon Labs Cut Nearly 3,000 Jobs!

1. Sika

On October 24, Sika announced its operating results for the first three quarters and stated that the company is undergoing structural adjustments in persistently weak markets such as China, expecting one-time costs to reach between 80 million and 100 million Swiss francs by 2025. These measures include laying off up to 1,500 employees.

From the core performance highlights:

Despite a double-digit decline in the construction business in China, sales for the first nine months still grew by 1.1% in local currency terms; furthermore, excluding the construction business in China, the group's growth rate in local currency terms was approximately 3%.

Overall, due to the impact of a weak US dollar, the foreign exchange effect amounted to -4.9%, leading to a decline in sales calculated in Swiss francs to CHF 8.58 billion (previous year: CHF 8.91 billion). The material margin rose to 55.0% (previous year: 54.7%). The EBITDA margin expanded to 19.2% (previous year: 19.1%), thanks to a slight decrease in input costs and strong synergies from the successful integration of MBCC, although a decline in sales in the Chinese market led to a drop in EBITDA by approximately 50 basis points. Due to significant exchange rate fluctuations, the earnings before interest, taxes, depreciation, and amortization (EBITDA) for the first nine months was CHF 1.64 billion, lower than CHF 1.7 billion for the same period last year.

II. Application Materials

According to the 8-K filing by Applied Materials on October 2, the company expects a revenue reduction of $110 million in the fourth quarter of fiscal year 2025 and $600 million in fiscal year 2026, due to the new export control rules issued by the U.S. Department of Commerce on September 29. Under the new regulations, subsidiaries in which entities on the entity list hold more than 50%, as well as foreign affiliates directly or indirectly held, are subject to restrictions.

The financial report for the third quarter of fiscal year 2025 shows that revenue from the China region has increased year-on-year, remaining its largest revenue source. However, company executives stated that due to the need to digest equipment shipments from 2023 and 2024, they expect the Chinese business to continue declining in the coming quarters.