AMD Adds 100 To Planned Layoff
SAN JOSE, Calif. -- Seeking to cut more costs, Advanced Micro Devices Inc. (AMD) has reduced its headcount by approximately 600 employees--about 100 more jobs than expected, according to a filing with the U.S. Securities and Exchange Commission (SEC).
More cuts are expected as well. The troubled company previously announced the layoff. In the third quarter, the company reported that it would cut 500 employees. At the time, AMD (Sunnyvale, Calif.) said the move would result in a charge of $50 million.
Now, AMD has cut 100 more jobs than previously expected. It estimates that the restructuring expense that it will record in the fourth quarter of fiscal 2008 will be approximately $70 million.
''Of this amount, approximately $34 million is related to severance and costs related to the continuation of certain employee benefits, approximately $13 million is related to contract or program termination costs, approximately $17 million is related to asset impairments and approximately $6 million is related to exit costs for facility site consolidations and closures,'' according to the filing.
''Further cost reduction actions will result in additional charges in the first half of fiscal 2009, which the company cannot estimate at this time,'' according to the filing.
After a year in the works, AMD in October obtained an investment of up to $8.4 billion from the Abu Dhabi government and separately plans to split the company into two parts.
As part of the long-awaited and expected plan--which impacts 3,000 jobs--AMD will spin off its manufacturing operations into a new foundry company that will compete against TSMC, UMC, and possibly, one of its partners in Chartered. So, in effect, AMD will essentially become a fabless design house.