Lam Research, one of the top three suppliers of chipmaking equipment in the US, announced on Wednesday that it plans to cut about 7 per cent of its workforce in an effort to cut expenses in a declining market.

Tim Tim Archer, the company's CEO, said on a conference call on Wednesday that it would cut about 1300 jobs worldwide. He expects the overall market for chip equipment to fall to about $75 billion this year, about $20 billion less than last year.

Earlier, the Fremont, Calif.-based company reported disappointing quarterly results and forecasts that fell short of analysts' expectations.

The company said its chipmaker customers were slowing production lines, delaying the construction of new plants and reducing improvements to existing facilities. Electronics companies that buy chips are hoarding large amounts of unused parts, which is spreading across the supply chain.

The company has also laid off 700 temporary workers and will reduce the same number of temporary workers this quarter. Overall, the company expects costs related to layoffs and facility cuts to be between $150 million and $250 million.

"the coming year means a realignment of the market and our business," said CEO Archer. I am confident that by taking the difficult actions we have announced today, we will put Lam in a better position. "

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