AMD will cut 1,100 staff (CVG 19/1/09)

PC chip maker AMD will axe 1,100 jobs from its workforce, as well as make a series of salary reductions, in order to salvage company's mounting debt problem.

AMD will cut some 900 workers from all areas of its product business, and will make another 200 staff redundant by divesting its handheld business. The job cuts in total represent 9 percent of the business.

Also as part of the firm's strategy to drop debt, AMD will undergo a wave of temporary salary cuts. Company CEO Dirk Meyer is facing a salary drop of 20 percent at base level, while numerous vice presidents across the company will see salaries fall by 15 percent.

Other employees will see salaries cut between five and ten percent (depending on whether they are eligible for overtime), while the firm will suspended contributions to many of its workers' retirement funds.

An AMD spokesperson said the measures were "nothing highly unusual right now in the industry."

Last year AMD axed some 2,200 workers in two waves of job cuts. Further job cuts have not been ruled out. The company continues to struggle with the huge debt incurred from its $5.6 billion acquisition of ATI Technologies.

Soon after its purchase of ATI, AMD had to cut its $5.6b valuation of the company by around $2.5 billion. A regulatory filing shows that AMD is going to drop another $684 million from its valuation of ATI, effectively meaning the business is now worth around half of what AMD paid for it.

The devaluation of ATI, as well as further details on the job cuts, will be announced in AMD's quarterly results report later in the week. The firm has already stated that its turnover will see a 33 percent reduction from last year's results.

Market rival Intel last week announced a fourth-quarter profits fall of 90 percent, with sales dropping 23 percent. Both companies account for the vast majority of processors in all PCs, illustrating the difficulty the entire sector is facing at the moment.

expected that!

also, mr vampire, ever think of adding a newsfeed bot?

I'm Sorry to say cherry but PopGamerzz's host cannot at this time add news bots to Pop... When we get news of this feature....We will let you know

AMD rule(d)