The last round of job cuts late last year left AMD nearly unrecognizable for many, and now there are rumors that the chip designer is planning another round of massive cuts. WSJ heard AMD plans to fire 10 to 20 percent of the company's workforce, which stood at more than 11,700 at the end of the second quarter, while AllThingsD claims it could be as many as 20 to 30 percent. The latter site notes the company's latest 10K report mentioned a headcount of 11,100, which would mean the cuts would amount to between 2,200 and 3,300 jobs.
The job cuts are necessary to get AMD back on track, just yesterday the company announced that its fiscal Q3 2012 revenue will be 10 percent lower than the prior quarter due to weak demand and harsh economic conditions.
WSJ heard the new cuts may hit AMD's engineering ranks, including possibly the server operation:
Rory Read, appointed AMD's chief executive last year, previously cut some positions--particularly in functions such as marketing--and shifted some hiring priorities in an effort that he called making the company "fit to fight." Some outsiders who track the company suspect any new cuts may hit AMD's engineering ranks, including possibly its operations making chips for servers.
AllThingsD heard from one of its sources that the mood at AMD is grim, "there are a lot of nervous people, and not a lot is getting done right now", the source said. CEO Rory Read reportedly brought in a team of business consultants from McKinsey & Company to handle the cuts, while a team from BCG is said to be consulting on a "grand strategy" to take the company forward. The deep cuts suggest AMD may be forced to scale back some of its product offerings.
The cuts, the sources said, will affect employees involved in engineering and sales, groups of employees that have been spared in previous rounds of cuts. Additionally, these people, who are familiar with the company’s operations, suggest that the cuts will be deep enough as to indicate that AMD may be forced to scale back some of its product offerings.