AMD Laying Off Up To 30 Percent Of Workforce: Reports8:02 PM EST Fri. Oct. 12, 2012
AMD is potentially preparing to announce next week that it will lay off up to 30 percent of its staff, a move that comes shortly after the semiconductor company announced disappointing preliminary third fiscal quarter results.
AllThingsD, an online news service of Dow Jones & Company, on Friday reported that AMD plans to lay off 20 percent to 30 percent its staff.
Citing unnamed sources close to AMD, AllThingsD said the announcement could come as early as next week.
That would result in cuts of between 2,200 and 3,300 of the company's 11,100 employees, including staff in the company's engineering and sales organizations, AllThingsD reported.
The cuts are the latest in a string of bad news for AMD, one of the world's largest semiconductor companies and the only processor developer to historically have given Intel serious competition.
AMD on Thursday announced preliminary results for its fiscal third quarter, saying it expected revenue for the quarter to fall 10 percent compared to its second quarter, as opposed to the original expected drop of about 1 percent as a result of weaker-than-expected demand due to the "challenging macroeconomic environment."
The company also said third-quarter gross margins will be about 31 percent vs. prior expectations of 44 percent due to inventory write downs and lower average selling prices because of the weakened demand.
The third-quarter preliminary financials follows a dismal second quarter when AMD reported income of $37 million on a revenue of $1.41 billion, down 10 percent from the $1.57 billion in revenue it reported during the same quarter last year.
AMD in September also said that its CFO and former Interim CEO Thomas Seifert resigned, the latest in a string of high-level departures from the company.
AMD is by no means alone in suffering from a slowdown in PC sales. Intel in July lowered its earnings outlook for the year, citing continued economic uncertainty and sluggish PC sales as consumers wait for Windows 8 to launch this fall.
AMD will officially report its third quarter 2012 results on Thursday, Oct. 18.
AMD did not respond to request for further information about the expected layoffs.
Kristin Bent contributed to this story.
PUBLISHED OCT. 12, 2012