Quantum Cuts Workforce by 8% or 180 Employees

Quantum Corp. is reducing its workforce by approximately eight percent (180 positions) and taking other steps to decrease expenses, largely in response to the global financial crisis and related market uncertainty. Quantum expects these combined actions to result in annual savings of approximately $18 million, and the company will see a partial benefit from the changes in its quarter ending Dec. 31, 2008. Quantum’s preliminary estimate of the costs associated with these changes is approximately $4.4 million, consisting of one-time termination benefits.

While reducing total expenses, Quantum will continue to increase investment in its data deduplication and replication technology and its DXi-Series disk backup solutions. This reflects a key growth opportunity for the company, and over the past six months it has established a stronger leadership position in deduplication through the introduction of new products, enhancements to its channel program, and closer collaboration with both EMC and Dell.

"The expense reductions we are making are intended to provide additional operating margin and incremental EBITDA growth as we confront the challenges posed by the current macroeconomic environment," said Rick Belluzzo, chairman and CEO of Quantum. "Despite these challenges, we remain in compliance with all our debt covenants and expect to be in compliance for the next twelve months. In addition, we continue to see strong demand for our branded DXi products and are excited about partnering with EMC and Dell to develop a common architecture that leverages our deduplication and replication software and provides customers with even greater flexibility and choice in meeting their data protection and disaster recovery needs."

Earlier this month Dell announced that it is working with both Quantum and EMC to create deduplication and replication compatibility across the three companies’ product offerings. Dell’s announcement followed EMC’s introduction of new deduplication solutions incorporating Quantum’s software last May.