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AMD laying off 15% of workforce

Posted: 22 Oct 2012     Print Version  Bookmark and Share

Keywords:restructuring  IP  embedded market  Z-60 

As expected, Advanced Micro Devices Inc. (AMD) is laying off 15 per cent of its global workforce as part of a restructuring plan.

The roughly 1700 layoffs would be completed in the fourth quarter of this year.

The announcement came as AMD reported a loss of Rs.853.26 crore ($157 million) for the third quarter of 2012. The company's revenue was Rs.6,902.17 crore ($1.27 billion), down from the second quarter when revenue was Rs.7,663.04 crore ($1.41 billion).

"The PC industry is going through a period of very significant change that is impacting both the ecosystem and AMD," said Rory Read, AMD president and CEO. "It is clear that the trends we knew would re-shape the industry are happening at a much faster pace than we anticipated."

AMD expects that the restructuring actions taken in the fourth quarter of 2012 will result in operational savings, primarily in operating expenses, of approximately Rs.108.70 crore ($20 million) in the fourth quarter of 2012 and approximately Rs.1,032.61 crore ($190 million) in 2013.

The chipmaker is also putting in place a business model to break even at an operating income level of Rs.7,065.22 crore ($1.3 billion) of quarterly revenue. The company is targeting to achieve this by the end of the third quarter of 2013.

Interim CFO Devinder Kumar offered little insight into where the cuts might come, other than to say "it's across all functions and globally."

Read also sketched out a push into embedded areas that will leverage IP and emerging processor technology to quadruple the percentage of AMD sales from the embedded market in the coming year.

"Our low-power APUs, graphics IP and reusable design blocks give us a distinct advantage to build semi-custom APUs for new embedded markets," Read said. He said AMD would target embedded markets such as communications, industrial and gaming in this push. This "will outpace the PC growth for the foreseeable future," he added.

Read said AMD APUs have a "number of confidential, high-volume wins," but he refused to discuss specifics.

Lisa Su, senior vice president and general manager, global business units, added, "The key differentiator we have is really in the high-performance design methodology, microprocessor technology as well as the graphics IP that we have."

AMD recently introduced Z-60 chips for upcoming Windows 8 tablets. However, the OEM partners are yet to be announced.





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