AMD slashes jobs as earnings slump
AMD’s financial woes continue to deepen after the company announced it was to shed around 10% of its workforce following disappointing first-quarter earnings.
The embattled chip maker will shed 1,650 jobs across its global workforce of 16,800 staff. The layoffs will start this month and be completed by September.
The redundancies come as the company shocked analysts with lower than expected first quarter results. The company estimates sales of $1.5 billion, a 15% drop year-on-year and more than $100m short of what most analysts had predicted.
“The decrease is due to lower than expected sales across all business segments,” the company claimed in a statement.
This latest setback to the company’s share price leaves the company valued at only $3.8 billion – that’s $1.6 billion less than it paid for ATi only two years ago. It will also make AMD a prime contender for a takeover, with one analyst speculating recently that Nvidia would be the ideal suitor.
AMD’s board issued a mea culpa at the end of last year, admitting that it had “bungled” the launch of the Barcelona processors.
“I understand we made some commitments, especially on quad-core, we did not meet. Shame on us,” said CEO Hector Ruiz at the time. “We blew it, and we’re very humbled by it, and we’re going to learn from it, and we’re not going to do that again.”