AMD layoffs come amid severe financial struggles

Oct 2, 2015 06:56 GMT  ·  By

It’s very possible that Advanced Micro Devices would cut down its workforce by five percent as it starts to struggle financially. As a result, the company said that it would begin to restructure its IT department, consolidate facilities and appoint two local presidents to oversee crucial regions.

Apparently, the plan is to focus on simplifying business and better align resources around its priorities to build its products. The move comes after AMD managed to internally separate its CPU and GPU business a month ago, in order to better organize projects between products.

Since departments are getting smaller, comprising more focused teams, it's clear that some people will lose their jobs. Unfortunately, this was a bit predictable since AMD halted discussions with Silver Lake hedge fund based on inconclusive results, so any immediate cash infusion is unlikely.

Once the headcount drops by 5%, AMD will apparently save some $9 million in 2015 and, according to Venture Beat, $58 million during the next year. This staff layoff will apparently help the company better assess its near-term revenues.

Impairment charges and restructuring will also help the company gain another $41 million in its results for the third quarter of 2015. Fortunately, AMD is not the sort of company spanning many countries and paying tens of thousands of employees, so a 5% drop from 9700 employees it has now to 9200 won't be such a shocking headcount drop.

AMD re-orients itself to better satisfy geographical markets

Since it starts to lack the money to internally develop its applications and maintain its IT services, AMD will start to outsource these departments. This might not be good news for AMD customers that relied on known contacts or have pleasant experiences trying to troubleshoot AMD device problems.

Outsourcing means new teams of engineers and customer support people. Servers and data centers will also move to outsourcing so it's very likely Catalyst control center servers will also move from AMD to outsourced companies.

Graphics adapter drivers teams, however, will still remain in AMD's tight grip and will not be outsourced, and they will continue to work under the same roof as per usual. To better focus on geographic tendencies, and especially China, the company is creating two regional president positions. The new figures are Spencer Pan, who will become AMD’s president responsible for Greater China, and Darren Grasby, who will be AMD’s president in EMEA.