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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."
Early retirement - the perfect recipe for short term savings and long term loss of institutional knowledge!!
Intel will just give them a few billion. Cheaper than to deal with antitrust issues if AMD goes bankrupt.
Early retirement - the perfect recipe for short term savings and long term loss of institutional knowledge!!
But, but, its all documented! So even kids right out of school can replace the laid-off engineers when demand comes back.
Sheesh! It's not like they're VP's or something equally irreplaceable!
3. Profit!
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!
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.
I'll take that bet. I'm pretty sure they are doing the opposite: laying off all the junior engineers, support engineers, and the sales and marketing force in preparation for having some larger company (with their own army of overseas junior engineer worker-bees) take over. The consultants are there to negociate the headcount on behalf of the purchasers, they have nothing to do with the current management or the current product line. The consultants are like the home inspectors that a you hire when you are buying a house...
My guess is that larger company is probably one of Samsung or Qualcomm, secondary guess would be Apple or Microsoft. Both Samsung and Qualcomm have been hiring AMD (ex ATI) folks left and right for the last few months and if they can pick up AMD for a song, they will probably do it. What any of these companies don't need are a bunch of 2-5 year engineers, supporting engineers, nor sales or marketing employees as a purchasing company, they are likely to just abandon all the current (and planned) product lines. The only thing the want is the core engineering assets (GPU designers and high-speed CPU physical design group) and the patents to deploy in their own product lines. The consultants job is to figure out who those folks are. All the bulldozer architects and APU stuff will probably go in the dumper as soon as the deal is closed.
Put a fork in it. AMD as we know it is probably done.
Uh, yeah.
Down 6% in Q1, down 11% in Q2, and they were expected to be down 1% in Q3... instead they were down 10%.
Meanwhile they're not competeing in servers or smartphones, the PC market is shit and it isn't looking like it's going to get any better. Laptops are the one place they're strong, and nobody is optimistic on laptop sales.
It's bleak over there, and believe it or not, they've got a pretty good idea of just how bleak it is.
Have a foot in both x86 and ARM.
You arent very well informed. AMD doesn't fab processors, so cannot possibly fab ARM processors. AMD is like ARM now and only designs processors, but unlike ARM they do not license the design out (probably they cannot, thanks to IP deals with Intel.)
AMD spun off their fab business in 2009, which is named Global Foundries, divesting their last shares in the company earlier this year.
"His name was James Damore."
Current employee here (I'm not an official spokesperson, this may not be the corporate line, yadda yadda) let me clarify some stuff.
The thing with Intel is, internally they're actually a worse corporation than even you described. Head hunters I have known almost immediately blanched at their name when I brought it up and said things like .. I do not recommend anyone work for Intel. I have seen the same remarks by the same professionals in print.
Why? For generations now, it's been stocked to the gills with corporate psychopaths. Like above, so below. The level of viciousness of the politics is out of this world . For instance, there's something called "forced ranking" where 10% of their employees with the lowest scores on their reviews are automatically fired each year.
Killing every tenth person in order to improve performance has another name- decimation.. deci-mation. It goes back to the Romans. Crassus used it to motivate the troops to capture Spartacus
Yes, we have problems with people who exist only to further their own career, or that somehow subsist by controlling information such that no one else can get it. The information hoarders in particular are annoying because you have to have their blessing to get stuff done. I believe that any organization with >80k employees is going to have this somewhere in their organization
We have some psychotic managers that act like 2 year olds. They put unattainable deadlines on the board and they hoard resources to do their job. I hear that this was the norm in the previous CEO's days because of the 10% layoffs of which you speak. The way it worked wasn't 10% of the worst employees, but rather entire departments would be cut for failing to meet the numbers. While I have a good manager, and several other people I know have, you may end up having one of these ancient trolls that still exist within the system. The perception is that Paul is trying to clean this stuff up, and the review process has been restructured to try to weed this out.
Intel does have a bad reputation in some of the local communities for various reasons. I hear stories of construction projects that never started, never finished, or sat around forever. I'm sure you're not wrong about your headhunter stories.
For reviews, employees are ranked in a scale against each other. You're put into one of 5 buckets, and you want to try to be in the top 3. The relative performance of each bucket is determined by the performance of you and your peers (i.e. you have to be better than your peers. If they all suck, the bar is pretty low, but if they're geniuses, you better work your ass off.). I don't think there's a set percentage for each bucket. If there's not enough people to compare you to at your site, you're compared to similar people in your hemisphere. This isn't all of it, like there's some more paperwork involved in getting feedback from coworkers and such, but at the end of the day you're in one of the buckets.