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AMD takes an additional $70 million in restructuring charges

AMD and ATI have not enjoyed the success the two firms envisioned when AMD bought the graphics firm in 2006. AMD is hurting due to the global economy and announced this week that it will take an additional restructuring charge related to the $5.4 billion is spent to purchase ATI.

AMD says that it also laid off 100 more employees than it had originally announced bringing the total laid off over the quarter to 600.

As a result of the additional layoffs, AMD is recording $70 million in restructuring charges rather than the $50 million in charges it has expected. The chipmaker also says that the new cost reduction would result in additional charges though the first half of 2009, though the firm did not specify what the additional charges would be.

EWeek reports that AMD will take an additional goodwill impairment charge related to the ATI purchase from 2006. AMD says that the charge is based on an updated, long-term financial outlook. This isn’t the first impairment charge AMD has taken in relation to the ATI purchase, in June of 2006 AMD took a charge totaling $800 million. AMD will also take a $20 million impairment charge on an investment in flash maker Spansion.

AMD announced in early December that it was cutting revenue forecasts by 25%.

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I feel bad...
By amanojaku on 12/30/2008 2:03:16 PM , Rating: 4
Because I, and people like me, am partly to blame for this. I want 45nm AM3 processors and refuse to buy anything from AMD until the processors and motherboards are available. I'll compensate by buying a 4850.

RE: I feel bad...
By Omega215D on 12/30/2008 2:26:52 PM , Rating: 2
Get the 4870 1GB instead, it's pretty cheap and when you get your future processors there won't be much of a bottleneck. As stated on Anandtech, it's the card to get.

I did it the other way around getting a Quad Phenom paired with a EVGA GTX 260 Core 216 (it was on sale and reportedly runs GTA IV better). I stick with AMD processors due to the platform as a whole as being more upgrade friendly.

RE: I feel bad...
By 9nails on 12/31/2008 9:14:02 AM , Rating: 2
I'll share in that blame as well. But my justifications are driver and chipset based. I offer my ATI-based TV Tuner in my current rig as compensation. (And suffer through the driver issues, even still.) But my past experience with AMD based motherboards has shown that Windows (in general) finds more stability and compatibility on an Intel based chipset. I've enjoyed ATI video cards in the past, but credit Nvidia for working closer to Microsoft and likely the candidate to provide me a more stable driver.

It's not all about performance. Some of us want to get work done.

RE: I feel bad...
By saiga6360 on 12/31/2008 10:41:06 AM , Rating: 2
Buy 4 and you'll be just about even.

"Paying an extra $500 for a computer in this environment -- same piece of hardware -- paying $500 more to get a logo on it? I think that's a more challenging proposition for the average person than it used to be." -- Steve Ballmer
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