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AMD announces the job cuts after a brutal Q1 earnings announcement

After confirming it had to reduce expenses, AMD recently announced that it will cut 430 jobs worldwide, which is 2.6% of its workforce.  Around 40 jobs will be cut in AMD's Sunnyvale and Santa Clara, CA offices; 80 jobs in Austin, TX; around 12 in Boston, MA; and 50 in Markham, Ontario.  No workers in Dresden, Germany, location of AMD chip-making facilities, will be laid off. 

The remainder of the job cuts will be spread throughout AMD offices and manufacturing locations around the world.  Most of the jobs will be from marketing, sales and administration, but several engineering jobs will also be cut.

The announcement comes after AMD Chief Executive Hector Ruiz described AMD's recent performance as "unacceptable."  Ruiz said that as many as 800 jobs, the equivalent of 5% of AMD's workforce, would face possible elimination.

"There is no way to sugarcoat our performance in the first quarter," after the company posted a $611 million loss, said Ruiz.

Industry analysts are unsure if AMD will have to cut more jobs in the near future.  "I'm surprised the number is as small as what it is," said Brian Piccioni, a BMO Capital Markets analyst.

American Technology Research analyst Doug Freedman believes the job cuts could "save the company about $40 million per annum in operating expenses and add 8 cents to the bottom-line."

AMD recently detailed its desktop plans for the next year, which the company hopes will help it regain footing in the CPU market.  It recently unveiled Agena FX, a quad-core desktop CPU, and plans on unveiling Phenom FX next week. 

The company remains engaged in a brutal price cut war with Intel.  Intel slashed prices on the Core 2-family late last month, with deeper price cuts expected this summer.  In addition, Intel was able to neutralize an entire year of AMD marketshare gains in one quarter.

While Intel released the Core 2 Duo chip last year, AMD believes its Barcelona technology will offer better performance since it has four cores on a single die.

Intel recently also announced that it will cut another 1,000 employees at a plant where some employees worked on  200mm silicon wafers.

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RE: Core 2 + the ATI purchase
By Mitch101 on 5/11/2007 5:29:43 PM , Rating: 2
I think what they did wont yield any quick returns but in the long run its the right decision when you look at the big picture. Read ANANDTECH's article.

Also any time there is a merger there is duplicate positions that should be eliminated. Sometimes it takes a little while to determine where to make cuts.

Core 2 did put a dent in AMD's plans but I expect them to bounce back into the game.

If all works well AMD will reduce existing inventory as much as possible while stockpiling K10 and have enough to supply the channel for the BACK TO SCHOOL LAUNCH. Thats the most profitable time of year and I suspect thats AMD goal to have all thier ducks in a row for a massive assualt on Intel since we pretty much know a K10 at 2.5ghz beats a Conroe and should beat Penryn in NON SSE4 benchmarks. Also the rumors of AMD having 2.9-3.1ghz chips on the respin of silicon. This might be AMD's biggest launch ever they need to get it right even if everyone today wants to see benchmarks.

RE: Core 2 + the ATI purchase
By darkpaw on 5/11/2007 5:47:32 PM , Rating: 2
There won't be any K10s for the back to school period. The other article that was just posted today said they are shooting for Christmas.

RE: Core 2 + the ATI purchase
By RW on 5/11/2007 9:50:45 PM , Rating: 2
The latest news is that K10 does have SSE4A read more on:

So it should be competitive even on SSE4 benchmarks.

RE: Core 2 + the ATI purchase
By defter on 5/12/2007 5:41:56 AM , Rating: 2
??? Why would it? Barcelona doesn't support SSE4.1 or SSE4.2.

RE: Core 2 + the ATI purchase
By Amiga500 on 5/12/2007 12:03:29 PM , Rating: 2

From this it appears to support SSE4a.

This has differences from SSE4.1 and SSE4.2 which intel are going to introduce. What the differences are I am not sure.

RE: Core 2 + the ATI purchase
By defter on 5/12/2007 1:38:37 PM , Rating: 2
The difference is huge. Your link showed that SSE4a includes only 4 new instructions: "MOVNTSS, MOVNTSD, EXTRQ, INSERTQ".

Intel's SSE4.1 includes 47 instructions and SSE4.2 includes 7 additional instructions.

Thus SSE4a will not make much difference in media encoding.

"We don't know how to make a $500 computer that's not a piece of junk." -- Apple CEO Steve Jobs

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