Report: AMD to Cut Up to 30 Percent of Engineering Staff in Coming Weeks
October 14, 2012 6:54 PM
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The company is expected to announce the number of lay offs in the next week -- around the time it will be reporting its quarterly financial results
Advanced Micro Devices
(AMD) will be cutting as much as 30 percent of its staff before the end of the year.
AMD, which makes processors for PCs and servers, is getting ready to lay off anywhere from 20 to 30 percent of its employees in the next few weeks. The company is expected to announce the number of lay offs in the next week -- around the time it will be reporting its quarterly financial results.
This marks AMD's second big staff cut in a year's time. About a year ago, it cut 10 percent of its employees. At the end of Q2 2012, the company said it had 11,737 employees.
Why is AMD making such drastic reductions in staff? Mainly because it is struggling to compete with other
like Intel. Intel has not only grabbed the PC and server markets, but has also dipped into the mobile market as well, offering
tablet and smartphone chips
. AMD, on the other hand, hasn't made a push for mobile yet. This is clearly problematic, considering the PC market has been in decline in favor of mobile devices, and chip makers like Intel and AMD have to adapt to stay alive.
In addition to competition,
reported that AMD's board is a huge reason as to why the company was forced to make staff cuts. The report said that AMD's board is "incompetent" and that the company "staffed senior management with toadies who would do their bidding rather than do the right thing."
noted that AMD is mainly cutting engineers, and that AMD likely will not survive with this cut.
AMD has already announced ahead of its quarterly earnings report that that revenue would decrease 10 percent instead of the previously forecasted four percent decrease to two percent increase.
However, AMD is hoping for a brighter future with its first mobile chip release for Windows 8 tablets this year.
AMD is expected to announce quarterly earnings this Thursday.
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RE: Close but not quite right
10/15/2012 8:23:33 AM
You are talking David and Goliath here
Exactly. AMD is MINISCULE compared to Intel (in fact, currently their market cap is approximately one-fiftieth of Intel's). Their product volume is far larger than a player of their comparative size would ordinarily have, however they're a whole node behind AND using SOI for Llano/Trinity/FX so it's a lot more expensive for them, which means lower margins. Additionally, they've had to pay GlobalFoundries off and will continue to do so for the next few years.
One can only hope that the engineers who're being booted are literally surplus to requirements, but in the past, we've seen the wrong sort of people go, which makes me think this is more of the same. AMD cannot disappear though - aren't they supposed to have significant backing in the UAE, along with two next-gen console wins to provide GPUs/APUs for?
AMD needs to accelerate their roadmap. Steamroller cannot come quickly enough on the server front.
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