Advanced Micro Devices (AMD) Declares $157 Million Losses and Confronts Its Layoff plans

Advanced Micro Devices has admitted that it is going to cut the work force by 15 percent. It is the second time that the company is looking forward to laying off the employees. The company has struggled with the poor global economy and consumer shift towards smartphones and tablets.

Rory Read, the company’s chief executive said that he is not expecting the personal computer industry to improve for next couple of quarters.

AMD is the number 2 chip maker after Intel. The company indicated that it is going to save almost $190 million next year with these layoffs. They are expecting that the restructuring expense will be around $80 million for the 4^th quarter.

It is expected to bring the earning up in near future. The market is not going well on their way. Even they are not that strong in position.

A.M.D. has warned that since their 3rd quarter revenue was even worse compared with its previous year’s, they may have to take certain radical steps. The gross margins have suffered more because of low future growth towards the products.

The company has posted total loss of USD 157 million or total share of 21 cents. They have posted a good profit last year with USD 97 million, or share of 13 cents. The company’s revenues have dropped to USD 1.27 billion from USD 1.69 billion.

Mr. Read has promised to fix the long-standing problems that overwhelmed the company. However, AMD continued to move in losses. They lost market share to Nvidia and Intel. He said in a conference that trends will get reshaped very soon in the company and it would happen at faster pace than expected.

Now, the company is looking forward to the stream that has faster growth than PC. It said that it has plans to enter into selling chips for industrial, communications, and gaming applications. He also mentioned that new areas will grow at a faster pace and increase the quarterly revenue by 20 percent, when compared with the current 5 percent growth rate.

Akin to Intel, A.M.D., based at Sunnyvale, Calif., has been caught flat-footed in the past couple of years with the surfacing and rapid growth of mobile devices such as Apple’s iPad.

Intel and A.M.D. have been little slow in adapting their chip designs for mobiles. However, Intel has invested more on the huge resources to catch up with the smartphone industry with key players like Qualcomm. AMD hasn’t got any clear strategy in the mobile field.