Hutchinson Technology cutting 500 jobs to trim costs HUTCHINSON, Minn. (AP) May 2007 - Disk drive parts maker Hutchinson Technology Inc. said it will cut 500 Midwestern jobs this month, about 9 percent of its workforce, as it continues to lose money amid weak demand. The job cuts, in Hutchinson and Plymouth, Minn., Eau Claire, Wis., and Sioux Falls, S.D., are expected to be completed by the end of June 2007. The company said it will save $35 million annually, but it will incur a charge of $5 million, or 11 cents per share, for severance costs during the third quarter, which ends June 24. Before the job cuts, the company employed 5,353. Demand has been weak for the company's suspension assemblies for computer disk drives and average selling prices have dropped. In April Hutchinson surprised investors with an unexpected quarterly loss and said it would lose money for the full year. It said that during the first eight weeks of the current quarter, it had lost about $6 million, or 23 cents per share, before severance costs. Chief Executive Wayne M. Fortun said the cuts should position Hutchinson to be profitable beginning in 2008. As demand for its disk drive parts stays soft, Hutchinson has tried to move into health care products. Fortun said the company will continue its investments in an oxygenation monitor. The device monitors tissue oxygen saturation and is aimed at the trauma care market.

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