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AMD To Shed 10% of Its Workforce
stress_life writes "Recent rumors about AMD firing 5% of its workforce proved to be understated. AMD just announced that the company is going to deliver pink slips to 1600-1700 workers, or around 10% of its employees. AMD needs revenue of $2 billion per quarter, but Q1'08 is expected to come in around $1.5 billion. These firings have to be complete by Q3'08, the quarter by which Hector Ruiz promised to be profitable." We most recently discussed AMD's struggles in February.
I guess AMD buying ATi didn't help things either (?).
Too bad about the layoffs, though. I think this is going to get worse (across the whole economy) before it gets better. Business is so slow that my state's tax revenues have plummeted.
Sheesh, evil *and* a jerk. -- Jade
But Bluray drives dropped in price by almost half when HDDVD kicked it. They were about $250-$300 then, and are about $150 now.
I'm not an economist, but I have a good head on my shoulders and I have a masters in business. Help me understand how AMD hopes to turn around their company by laying off 10% of their staff? They're hoping the remaining 90% demoralized, repressed, deflated staff will do it? What are the chances the 10% that walk out the door may be their best and brightest and may have the answers to turn their company around?
It drives me crazy when companies think that the only way out of their mess is to lay off the staff, when the people responsible for the mess (board of directors and executive), don't give themselves a pay cut of 10%. Chances are, knowing how US exeuctives pay themselves, it would proably equal the amount saved laying off 10% of their staff. But what do I know?
Management is doing things right; leadership is doing the right things. - Peter F. Drucker
They're firing 10% of their workforce. Not "shedding" them. Is "lay off" not enough of a euphemism? Now we're going to use "shed"?
Please tell me about all of the successful new entries into the non-embedded CPU marketplace in the last 10 years.
If you're working on stuff like CPUs, the semiconductor industry has positively WICKED barriers to entry.
The living have better things to do than to continue hating the dead.
I suspect we'll see the economy get a boost whenever the next person is elected President in the U.S. Traditionally, that's been the case, again due to perception much more than reality. (We like to have a scapegoat for our problems. When they're economic in nature, the President tends to be that scapegoat. The fact he's shown the door and someone new comes in is enough to make people believe things "can get better now", even if nothing has really changed yet.)
The "trend" I've observed in the last couple years is one of businesses trying to be more efficient with the employees they keep. Instead of 3 people, they're always asking, "Can we get by with one higher-paid worker who can then be asked to do the work of those 3?" If not, then they ask "Can we do things differently so we don't need to hire a replacement for employee X who is leaving?"
The statistics I saw published a few weeks ago bore that out. Despite the 5.9% unemployment rate shown, it also indicated average pay was UP over last quarter.
There is yet one dwarf in Moria who still buys AMD.
:P
Seriously, though, I realize I'm a bloody hypocrite for laughing at Mac fanboys whilst being an AMD fanboy, but I love AMD. I want to do things illegal in Texas to my Opteron.
I also realize I'm partially moronic for having brand loyalty in this day and age - but I've never had a problem with any AMD chip. They just work. Perfectly.
So the rest of you Slashdotters go ahead with your 'logic' and 'benchmarks'. I'll keep AMD afloat so you can enjoy competitively priced Intel chips.
AMD's product line can't beat Intel right now but they started out that way and managed anyway. They had gotten along quite well selling a second-rate cpu that was good enough for a lot of applications whereas Intel was always pushing the performance envelope and charging accordingly.
When the Athlon came along, I think AMD was as surprised as the market was that Intel couldn't compete technically. Those days are gone, at least for awhile, and AMD is back where they started. There'll always be a market for a cheap cpu that does the job.
The only way to get ahead is to invest in appreciating assets. IRAs and 401Ks are good for supplementing a well-rounded investment portfolio, but there's no way I would stake my entire future in them alone.
"It is a denial of justice not to stretch out a helping hand to the fallen; that is the common right of humanity."
Reducing your workforce when your problems are based on Sales and Technical issues is a stupid move. Because those are some of the major areas which need people to get the product back on par.
Massive Layoffs are usually bad business decisions.
1. You reduce people who make your products better.
2. When/if you do start growing you need new people back, and then there is the turn over cost to take account of.
3. You in the short term raise your profits but don't fix the problem of the declining profits. The people on Top are Fat and Happy because they see the big numbers. But by not fixing the underlining problems The next quarter or fisical year the problem will reoccure again.
4. Layoffs effect the moral of those who are hired. Causeing them to spend more time and effort in either A. Politicking themselfs to not get laied off. B. Spenind time to find a new job. Niether of these means they are working harder at their actually jobs.
5. Ex Employees go work for the competition with their own Intelectual Property with them.
6. For big companies like AMD Layoffs effect the local economies of the areas. Which will normally cause a raise in taxes on the local companies (Including AMD) where if they were a big employeer then they may have tax breaks to incorage the company to attract people and businesses in the town.
7. Any slowdowns in production or product releases (due to limited labor) will cause customers to switch to cometitors.
8. Empty offices account to paying for unused property.
9. Extra workload on existing employees may lead to increase mistakes.
10. New Employees will be hesident in joining. Making rerecruting difficult if business does pick up.
See the MBA program is not all about Evil.
If something is so important that you feel the need to post it on the internet... It probably isn't that important.
I remember when Apple first switched to x86 a few years ago and everyone was screaming about them picking Intel over AMD. Apple's response was that based on Intel's roadmap, they were the better choice.
The past few years has certainly vindicated Apple on that regard. They absolutely made the right choice.
Yes, indeed the new deal did nothing to rebuilt the US of A and its production infrastructure to the point that it could out produce the 3 power of the axis combined.
In fact, FDR's plans were so catastrophic that he was elected "only" 3 times, and people cried in the streets when the guy crooked.
Sometimes, the ignorance of the American populace as illustrated by the anonymous coward above astounds me. The lemming attitude that makes idiots like these proactively handicap their own interests astounds me.
So let me get this straight, one of the few economic policies with a proven record of success (the new deal for example) are now framed as toxic. Whereas the insane policies that led to the gilded age, the great depression, the crash of the late 80s, the recession of the early 90s, and the current credit crunch... all those things are now gospel. Wow!
No wonder that capitalism is about making dumb people part of their money, as there seems to be an infinite supply of dumb idiots....
People don't save because all they know is to consume. The American culture is built around debt and consumption. We are at the first point in history since 1945 where Americans have more debt than equity. I don't care if HSBC gives you 10% for your online savings account, the consumer will spend his money like there's no tomorrow.
When you take ou a loan, "new money" is created as debt from that loan.
Even more off-topic, "new money" can be simplified into artificial gdp growth. It elegantly explains the economic expansion that took place a few years ago that had no real wage increases.
The risk is that the deflation of the asset bubble slows economic activity because the only people with any money will wait around for things to get even cheaper. Hence a downward spiral that is very hard to stop.
This is one of the rationale behind lowering interest rates and opening TAF's for any red-headed step child in the financial community. The wisdom of these moves will be argued for some time to come.
http://www.maxineudall.com/2010/02/should-economists-be-sued-for-malpractice.html
"Yes, indeed the new deal did nothing to rebuilt the US of A and its production infrastructure to the point that it could out produce the 3 power of the axis combined."
The original stock market crash had a good deal to do with expectations of a poorer business climate brought about by increased taxes and tariffs. The New Deal prolonged the Great Depression by cartelizing key industries. In fact, it was when these policies were repealed in the 1940s that economic growth started to accelerate again.
"In fact, FDR's plans were so catastrophic that he was elected "only" 3 times, and people cried in the streets when the guy crooked."
Re-election is not a sign of good economic policy or of good character. See the re-election of GWB as a recent example. You are falling prey to the argumentum ad populum fallacy by saying that because many people thought FDR was doing a good job he must have been doing a good job.
"So let me get this straight, one of the few economic policies with a proven record of success (the new deal for example) are now framed as toxic. Whereas the insane policies that led to the gilded age, the great depression, the crash of the late 80s, the recession of the early 90s, and the current credit crunch... all those things are now gospel. Wow!"
The track record of the New Deal is a sad one indeed. For evidence look to the second recession that took place in 1937. If it was working so well why did we have yet another recession and increasing unemployment?
"No wonder that capitalism is about making dumb people part of their money, as there seems to be an infinite supply of dumb idiots...."
If believing economic individualism is superior to central planning makes me an idiot than so be it.
Creative Demolition