AMD Reportedly Preparing Massive Layoff

An anonymous reader writes "AMD is preparing to lay off 20 to 30 percent of its workforce after warning of a 10 percent decline in Q3 revenues driven by the weak global economy and PC sales, according to AllThingsD's Arik Hesseldehl. The layoffs will reportedly focus on engineering and sales, and are in addition to a 10 percent headcount reduction 11 months ago. Teams of consultants from McKinsey and Boston Consulting Group are reportedly swarming headquarters to advise the CEO Rory Read, who took over from Dirk Meyer a little over a year ago; several senior executives, including the CFO, have recently departed."

Comments

10% decline in quarterly revenues?

[Anonymous Coward]

Shut. Down. EVERYTHING.

Re:10% decline in quarterly revenues?

[MukiMuki]

Am I dreaming? Is this a dream?

The 8150 gets trounced by the overclockable i5 2500k in just about every benchmark under the sun. The 2500k is $30 more. AMD doesn't even RANK in the upper tiers of Tom's Hardware's CPU gaming hierarchy.

To be fair, it's a card that's $30 cheaper and slightly outperforms the Sandy Bridge part in the highest levels of processing requirements (video encoding, 3D rendering, basically things that can hit 8 honest threads of use), but it gets hammered EVERYWHERE ELSE.

That's to a system builder. On the pre-built retail desktop/laptop circuit (read: the grand majority of sales), the situation is far worse, where that single thread performance gap makes the AMD parts look really bad.

Re:10% decline in quarterly revenues?

[WOOFYGOOFY]

I do not think I am debunking anyone; I am conversing. When I debunk, it's much bloodier.

This sums up the other link:

http://www.cpubenchmark.net/cpu.php?cpu=AMD+FX-8150+Eight-Core

Let's say 8150 is slower , 20-30% on single threading (I am not saying it's true, I am saying people say it) than intel's chip. Is single threaded the normal use-case or is that a competitive gamer thing (obsession) where the only thing separating you from your opponent is not skill or strategy but CPU speed on a single thread.?

Mostly, in my life, I am using more than one thread. I am doing a number of things at once. The OS wants one (or more). My programs all want as many as I've got. Even people who aren't working with IDEs and rendering applications are still, say, listening to music and watching a video and all this kind of thing all at once.

Intel's chip costs more, are slower except on single threaded applications, Intel is evil. I can OC the chip easily and have a nice stable system that is just as fast for zero extra dollars on a single threaded application.

But the overall thing to not lose sight of is -the chips are stupifyingly fast . We can look at CPU bench marks all day but mostly they sit idle waiting for our I/O to hurry up.

Not arguing here. Just observing and thinking aloud.

Re:10% decline in quarterly revenues?

[halltk1983]

Those things are ridiculously expensive to design and build. Smaller processes, linear optimizations, it's not cheap. And they just flat out don't have the capital. So what they were trying to do was focus on the bulk market to build back up some of that capital. The problem is that they didn't get the contracts from the big name manufacturers to provide them in bulk, and most of the people that buy at home will pat 75% more for that 10% boost in framerate and go intel. I buy AMD for a couple reasons. 1) I like the products. Overall they fit my need at a price point I like. 2) I like the company. I know a couple folks that work (or maybe worked soon enough) there. 3) I like competition. It keeps Intel's chips cheaper. I think that when AMD falls, the intel chips will go up in price, and then we'll be stuck with ARMs in our gaming rigs withing 5-10 years.

I just wish that more people bought their products for their machines, because we need them around.

How about laying off the consultants instead?

[KingSkippus]

How about laying off the consultants instead?

I'm serious. Consultants are nothing but leeches, and they will almost always give you advice on how you can make your company just like every other company in your industry. I yearn for the days when companies looked for ways to set themselves apart, to stand out from the crowd, instead of trying desperately to follow lockstep in line with everyone else. Other companies have massive layoffs, so hey, let's do it too!

Especially the engineers. You need engineers to keep doing what you do. This really bodes badly for AMD, because without engineers, they're basically slitting their company's wrists. I'll bet dollars to doughnuts that they're getting rid of the ones with seniority at that to try to save a few bucks on salary while simultaneously bleeding themselves out of knowledge and experience.

But hey, it's their funeral, so whatever gets the stock price up a little bit so that they can cash out their options, right?

Re:How about laying off the consultants instead?

[Killall -9 Bash]

The "Core" core was what put intel back in the lead... and they didn't even develop it themselves. They purchased an Israeli company that was making a new CPU based on the old P-III coppermine core.

Intel was, up until that point, still fighting the MegaHurtz war. This is in spite of the fact that the war had already ended a few years back when the AthlonXP line was easily beating higher clocked P4s. Intel's only answer was MOAR MHZ!!!1, spreading FUD about the performance ratings assigned to the AMD chips, and silly branding schemes that made me smack my head every time someone insisted they wanted a Centrino processor.

I really resent Intel for "cheating" their way back into first place.

Re:How about laying off the consultants instead?

[edxwelch]

It's bullshit. The Isreali division of Intel were making a version called Pentium M, and that turned into Core

Pussies

[tsotha]

Am I the only one who thinks management teams that bring in consultants to do mass layoffs are pussies? If you fuck up a company so badly 30% of the employees have to go, the very least you can do is not hide in the proverbial closet until it's over.

It doesn't really matter.

[Anonymous Coward]

Intel will just give them a few billion. Cheaper than to deal with antitrust issues if AMD goes bankrupt.

Consultants are not the devil

[rsilvergun]

yes, there are overpaid asshats out there. But most consultants are really just employees without health benefits and unemployement insurance. If you see a company with a lot of consultants that's why. You can fire them at the drop of a hat at no cost. It's a sign of the modern economy, and one of the reasons my political views swing so far left.

Re:Consultants are not the devil

[Anonymous Coward]

So far center. The world just moved right.

Re:Consultants are not the devil

[KingSkippus]

I don't think the kind of consultant you are talking about and the kind of consultant referred to in the summary are the same kind of consultant:

Teams of consultants from McKinsey and Boston Consulting Group are reportedly swarming headquarters to advise the CEO Rory Read...

These are the kind of consultants that tell the CEO that he doesn't need those expensive engineers with health benefits and unemployment insurance. For a reasonable fee (that will end up costing AMD even more money in the long run), these consultants will be able to bring in some of their company's other consultants and not have to worry about silly little things like benefits, thus reducing costs. For the next financial quarter or two--certainly long enough to cash out your stock options and find another job at a company that will pay you more because of your success here--it's win-win!

Re:Short term shareholder value

[Anonymous Coward]

AMD is in the mess they're in right now because their previous R&D didn't pan out. Bulldozer turned out to be a failure and AMD's competitor to the Atom, while better in most regards, is in a low margin segment of the market so even if they did take most of the sales there, it wouldn't help their profit all that much.

What the hell are they supposed to do at this point? The only part of the company that's doing well by any standards is their graphics division (formerly ATI) but that's not going to be enough to keep everything floating. They're going to need to cut somewhere as they're not making enough money to pay the staff that they have. Their best bet is to hold out long enough that someone else acquires the company. Not really sure who'd want to at this point, but their market cap is so low almost anyone could take them over.

McKinsey? BCG? They are doomed

[gweihir]

These people focus on short-term optimizations. AMD needs a strategic fix, not a tactical one. A tactical one will only make matters worse.

Re:Damn.

[lightknight]

Aside from the botched FX series, AMD is fine in higher-end PCs. However, that last processor line screwed the pooch, and for some odd reason, they bought into the hype / nonsense about low-power devices being "The Next Big Thing," and failed to ready a new top of the line processor. They're doing it to themselves.

As for the server stuff, hell yes they need a separate line. Those 12-core and 16-core processors are selling like hotcakes among University / College net admins, who want as many cores as possible for their VMs / clouds / whatever. No one needs the slight single-threaded performance boost and huge cost disparity that Intel has been offering.