AMS-Osram Restructuring Leads to 500 Job Cuts and Fab Exit

The recent developments at AMS-Osram have sent shockwaves through the industry as the company announced its decision to cancel a major project involving the production of microLED displays. This move has led to a series of restructuring efforts within the company, including the closure of certain facilities and a shift in focus towards automotive applications.

One of the significant changes brought about by the project cancellation is the company's decision to exit a wafer fab in Malaysia, which was originally intended for the microLED project. The cost associated with this decision has been estimated at €700 million, highlighting the scale of the impact on AMS-Osram's operations.

As part of its restructuring efforts, AMS-Osram is also reevaluating its CMOS image sensors business as part of a broader initiative to "re-establish-the-base." This includes the closure of a development site, although specific details regarding the location have not been disclosed by the company.

With over 500 employees affected by the restructuring, AMS-Osram is facing a challenging period of transition. However, the company remains optimistic about reallocating resources to strengthen its position in the automotive LED market, which is expected to become a significant segment in the industry.

Looking ahead, AMS-Osram is adjusting its strategy to align with the changing market dynamics following the cancellation of the microLED project. The company is focusing on investments in the automotive sector, anticipating sustained growth in this area. By shifting its microLED development towards automotive applications, AMS-Osram aims to achieve positive free cash flow by 2025.