Sadly it's hardly out of the ordinary to report a round of redundancies in these economically fraught times and AMD is no exception. The thing that makes the news of another 900 people being cut from chip company AMD, however, is that it's just the latest of many.
Notwithstanding its own unique challenges, AMD is in the same position as everyone else; of having to reduce its costs in the face of a decrease in business. But the fact that it's already in the middle of a pretty extensive streamlining operation makes us wonder how much fat there is left to trim.
Anyway, the facts are that the ‘product company' (which is AMD minus The Foundry Company) is going to going to add 900 to the existing 200 people it expected to lose in Q1 09. This 1,100 amounts to nine percent of the current headcount and should bring the level down to around 11,000.
There will also be some pay cuts, starting at the top and commencing in February. Here's what AMD's official statement had to say on the matter:
- Subject to the approval of the Compensation Committee of the Board of Directors and execution of an amendment to his employment agreement, CEO Dirk Meyer will be taking a temporary reduction of 20% in base salary.
- In the U.S. and Canada, we will be implementing similar salary reductions of 15% for VPs and above, 10% for all other non-overtime eligible employees, and 5% for all overtime-eligible employees.
- Outside N. America, we will be implementing voluntary pay reduction measures consistent with local policies and regulations.
- Suspend the 401K (U.S.) company match and delay implementation of the RRSP (Registered Retirement Savings Plans - Canada) company match program.
This was the conclusion of the statement:
These actions, while difficult, will allow AMD to better navigate the turbulent economic conditions while protecting our core capability to execute our technology roadmaps and position AMD for long-term success.