Advanced Micro Devices said it would lay off 500 people, or 5 percent of its 9,469 work force, as part of a previously announced restructuring.
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The company is not saying where this round of slashing will occur, spokesman Drew Prairie told SiliconBeat in an email. On its next financial report, AMD will record charges of around $42 million associated with the restructuring effort and job cuts.
Sunnyvale, California-based AMD had been in discussions to sell approx. a 25 percent stake to Silver Lake Management, a private equity firm, during the summer before talks stalled, according to Bloomberg. It also plans organizational actions such as outsourcing certain IT services and application development.
According to its latest annual filing in February, AMD had almost 9,700 workers by the end of previous year.
AMD expects to realize savings of about $2 million and $7 million from its plan in the remaining quarters of its fiscal 2015, along with savings of $58 million over the course of its fiscal 2016.
AMD has struggled to compete with larger rival Intel for many years and like the rest of the industry, is feeling the squeeze from the global slowdown in PC sales.
The company has been shifting to gaming consoles and low-power servers, but it really has not moved fast enough or come up with the sort of “wow” technology which is needed to see off Intel. (NASDAQ:AMD) ended the day at $1.74 with the gain of 1.16%. 1,412,345 shares of the company’s stock traded hands.
We rate ADVANCED MICRO DEVICES (AMD) a SELL.
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Advanced Micro Devices, Inc.is a global semiconductor firm with facilities across the world. Its revenue dropped by 30.5 percent to $1.97 billion in the first half of the year due primarily due to declining sales of computer processors and graphics chips. AMD has tried to develop its semi- custom chip business in recent years and Microsoft and Sony are its two biggest wins so far. The company’s weaknesses can be seen in multiple areas, such as its deteriorating net income, poor profit margins, weak operating cash flow, generally disappointing historical performance in the stock itself and feeble growth in its earnings per share.
