One of the biggest problems for AMD is the heavy competition from Intel which forces the chip maker to settle for lower margins. The average selling price of AMD processors dropped and retail unit sales were significantly lower than previous quarters.
AMD plans to restructure its business model to increase operational efficiencies and lower its operating cost structure. AMD will reduce 2007 capital expenditures by approximately $500 million, which the company believes will not materially impact capacity plans for the year. AMD will also significantly reduce discretionary expenses and limit hiring to critical positions. The company will provide more details during its conference call to report first quarter 2007 financial results on April 19.
AMD will report first quarter 2007 financial results after market close on April 19, 2007. AMD will hold a conference call for the financial community at 2:00 p.m. PT to discuss first quarter results.