Qualcomm Shares Tank Amid Layoffs

Qualcomm shares were down on Thursday after the semiconductor company began layoffs and is in the middle of a trade dispute between the U.S. and China over a planned acquisition.

Shares of the mobile chip manufacturer were down 4.6% in midday trading to $52.69 on Thursday.

Qualcomm plans to lay off around 1,500 employees in California as part of a broader push to reduce its expenses by $1 billion and improve its earnings, according to a Bloomberg News report on Wednesday, citing unnamed sources.

A Qualcomm spokesperson told Fortune in a statement that both full-time and temporary workers will be affected by the layoffs, without citing the specific number of full-time and contract workers that will be cut.

“We first evaluated non-headcount expense reductions, but we concluded that a workforce reduction is needed to support long-term growth and success, which will ultimately benefit all our stakeholders,” the Qualcomm spokesperson said of the layoffs in a statement.

Qualcomm (qcom) CEO Steve Mollenkopf revealed the company’s $1 billion cost-cutting initiative in January, but didn’t provide specific details. As Fortune’s Aaron Pressman explained, Qualcomm is under pressure to revive its shrinking, but crucial, core mobile business.

One of Qualcomm’s plans to revitalize its overall business includes its $47 billion bid for NXP Semiconductors, which makes computer chips for Internet-connected devices and autonomous vehicles. But that deal has faced a couple of roadblocks.

Qualcomm said on Thursday that it is withdrawing and refilling the acquisition notice related to NXP Semiconductors “at the request of the Ministry of Commerce in China.” By doing so, Qualcomm is pushing its acquisition deadline to July 25 from April 25, so that China could potentially approve the deal.

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The semiconductor giant is essentially caught in the middle of the current trade war between China and the United States, and Chinese regulators told Bloomberg News on Thursday that it is seeking unspecified additional concessions from Qualcomm before it clears the deal.

Meanwhile, Qualcomm is still recovering from a proposed hostile takeover by chipmaker Broadcom that President Donald Trump squashed in March via an executive order that cited unspecified national security concerns. If Broadcom were to have bought Qualcomm for about $117 billion, the deal would have created an enormous mobile computer chip giant worth more than $200 billion.