AMD Cuts Jobs After Low Earnings

Chip-maker Advanced Micro Devices (AMD) said yesterday that it would cut 10 percent of its work force, or about 1,680 jobs after giving a first-quarter revenue estimate below expectations. Citing lower-than-expected sales across its business, AMD estimated revenue for the quarter ended March 29 at about $1.5 billion, well below the average analyst forecast of $1.62 billion. "Demand is weak because of the economy. And then there's some (market) share loss that has contributed to the greater-than-expected shortfall," said analyst Ashok Kumar of CRT Capital Group, adding that analysts had expected a 7 percent sequential drop in revenue.

"We have a cost structure that we need to reduce due to lower revenue expectations, which are occurring in uncertain market conditions," said AMD spokesman Drew Prairie. However, Intel has not been immune to these problems. The company issued its own warning about the first quarter recently, cutting its gross margin forecast due to weaker pricing for NAND memory chips used in consumer electronics, such as digital music players and cell phones.

View: Full Story at Reuters

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