AMD has sent out a press release announcing "a restructuring plan and implementation of operational efficiency initiatives designed to strengthen the company's competitive positioning … [and to] create a more competitive cost structure and rebalance the company's global workforce skillsets, helping AMD to continue delivering industry-leading products while improving productivity, reducing time-to-market and better aligning with key industry trends that are expected to drive growth."
Unfortunately, all of this is just an impressive PR BS to convey the fact that they are laying off 1400 of their 12000 workers worldwide. The workforce reduction will occur across all functions globally and is expected to be substantially completed by the end of the first quarter of 2012. Based on anticipated savings from the restructuring plan, AMD expects fourth quarter 2011 operating expenses will be approximately $610 million. AMD expects that this will result operational savings, primarily in operating expense, of approximately $10 million in the fourth quarter of 2011 and $118 million in 2012.
AMD also expects to save approximately $90 million in 2012 operating expenses as a result of implementing efficiencies across the company's operations. All in all, AMD expects to cut its operational costs by more than $200 million in 2012.
AMD is blaming "slow PC industry" for its misfortune, but we don't think this is the whole story; At least because such a slowdown should have more effect on Intel which occupies around 80% of the market.
We already know that AMD's Bulldozer design is flawed and that its profit margin is far less than that of Intel CPUs'. We also know that AMD is facing trouble with the poor yields of its 32 nanometer manufacturing process, which jacks up the cost of production even further.
Unless AMD's engineers fix their design process and their manufacturing process, we are afraid more cuts might be on the way.
