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AMD tightens belt, cuts 900 jobs

Posted: 20 Jan 2009     Print Version  Bookmark and Share

Keywords:workforce  layoffs  cost control  chipmaker 

Advanced Micro Devices Inc. has announced plans to cut additional 900 jobs in the first quarter as part of a series of moves designed to trim down the chipmaker's workforce by about 9 per cent.

AMD will shed another 200 jobs through a combination of attrition and the previously announced divestiture of its handheld business, the company said.

The chipmaker has had two major rounds of layoffs in 2008. Late last year, AMD reduced its workforce by about 600 employees. Last July, it announced the layoff of 10 per cent of its workers.

Other cost control measures announced Jan. 16 included temporarily reducing employee base pay and suspending some benefits programmes. Executive chairman Hector Ruiz and CEO Dirk Meyer will be taking temporary reductions in base salary totalling 20 per cent.

AMD also said it will cut executive pay in the United States and Canada by 15 per cent. All other North American employees ineligible for overtime will face a 10 per cent salary reduction, the company added.

Outside North America, AMD said it would implement "voluntary pay reduction measures consistent with local policies and regulations."

In a statement, AMD said it had determined to take "difficult, but prudent" actions to reduce costs as the result of the continuing economic downturn.

A spokesperson for AMD said the job cuts would occur across all regions AMD operates in and span all levels of employees.

On Jan. 15, AMD rival Intel Corp. said its Q4 08 revenue fell to Rs.41,029.84 crore ($8.2 billion), down Rs.53,538.94 crore ($10.7 billion) from the same period of 2007. But the shortfall was widely expected after Intel cut its guidance for the quarter twice. Despite rumours, Intel has yet to announce any large scale job cuts.

AMD is scheduled to report Q4 08 earnings Jan. 22.

AMD is a distant second to Intel in the microprocessor market. The company made waves a couple of years ago by biting into the No. 1 chip vendor's market share, but has since lost surrendered the gains. AMD said in November it would not make chips for mobile internet devices and smart phones that would compete with Intel's popular Atom chip.

In a landmark move last October, AMD announced it would split into two parts, spinning off its fabs into a separate company backed by the government of Abu Dhabi.

Other large U.S. chipmakers are also expected to announced job cuts in the coming days.

- Dylan McGrath
EE Times

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