AMD Confirms Layoffs of More Than 1,000 Employees

AMD has officially confirmed plans to lay off 4% of its global workforce, amounting to more than 1,000 employees, despite forecasts for AI-focused chip manufacturing and sales.

Although 4% may seem like a small number, we are talking about the company employing around 26,000 people, which means that more than 1,000 employees will lose their jobs. In a statement given to Wccftech, an AMD spokesperson confirmed the layoffs, stating that they are “a part of aligning our resources with our largest growth opportunities.” AMD also mentioned that the layoffs are “a number of targeted steps that will unfortunately result in reducing our global workforce by approximately 4%.”

Stock Market Reaction

The stock market has not taken the news well, and during the last session, it punished the company with a 3% drop in the value of its shares—exactly the same percentage that Intel’s shares rose upon hearing the news. It is worth noting that Intel is also undergoing layoffs, cutting more than 15% of its workforce due to profitability struggles and posting losses in its latest quarters. By contrast, AMD’s forecasts showed an expected growth overall.

However, the company has reported some rather disappointing results in the gaming market, seeing its revenues fall by 69%. During its third-quarter earnings report, AMD revealed that its gaming revenue dropped to $462 million, with a 96% drop in operating income, which was just $12 million compared to $208 million a year earlier. AMD attributed this sharp decline to “lower semi-custom revenue.” As a result, everything points to these layoffs being part of a strategy to adjust its operations in order to grow in other markets (possibly AI).