PC chip maker Advanced Micro Devices said it will cut its work force by 15 per cent in a bid to reduce operating expenses, its second round of layoffs in less than a year as it struggles with a weak global economy and a consumer shift toward tablets.
The chip maker, with a staff of nearly 12,000, said in a statement it expects its restructuring actions, which will also include site consolidations, to result in operational savings of $190-million (U.S.) next year. It expects to record a restructuring expense in the fourth quarter of about $80-million.
Like its larger rival Intel, AMD was caught flat-footed in recent years with the emergence and fast growth of mobile devices like Apple’s iPad.
Tablets and smartphones, once considered a niche market by Intel and others, are fast gaining favour with consumers and eating into sales of laptops and desktop computers, while a slowing global economy is dampening spending in general.
AMD posted third-quarter revenue of $1.27-billion, down from $1.69-billion a year ago and a net loss of $157-million, or 21 cents a share, compared with a year ago profit of $97-million, or 13 cents a share.
Analysts had expected AMD to post $1.28-billion in revenue for the third quarter, according to Thomson Reuters I/B/E/S.
AMD estimated fourth-quarter revenue would fall 9 per cent from the third quarter, plus or minus 4 per cent.
AMD’s stock rose 3.4 per cent in extended trade after closing down 5.41 per cent at $2.62.