Transmeta Continues To Crumble

Remember Transmeta (TMTA)? Back in November 2000, the semiconductor company had a spectacular debut, coming public at $21 and more than doubling on its first day of trading.

The company had backing from billionaire Paul Allen, a legendary hire in Linux pioneer Linus Torvalds and an ambitious plan to take on Intel (INTC) in microprocessors.

Alas, the Transmeta story never quite played out according to script. And now the company just barely has a pulse. Yesterday morning, the company announced that it had received a “going concern” qualification on its 2006 10-K. The company has slashed its headcount; it cut 75 people on February 2, another 55 on March 31, and now is down to 65 people. And a further cut of 15%-20% is planned for the second quarter.

The company has abandoned the engineering services business, “ceased its operations relation to microprocessor production support,” and exited the microprocessor business. The new plan: licensing its technologies and IP.

Transmeta yesterday was down 13 cents at 44 cents, dropping its market cap to $86.9 million. On the first day of trading back in 2000, the market cap at one point topped $6 billion. Those were the days.