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AMD starts layoffs in Austin, U.S.

By kirk ladendorf | Thursday, April 17, 2008, 01:39 PM

Advanced Micro Devices Inc. cut 420 jobs today, including 215 in Austin, as the chip-maker took the first steps toward its major worldwide staff reduction that will continue for the next six months.

The job cuts will affect workers at all levels and in all parts of the country, AMD has said. The company said last week it would cut 10 percent of its 16,800 jobs worldwide by the end of September.

Today’s cut primarily affected company workers in North America, but eventually the company expects almost all its global operations will be affected.

The chip-maker announced the staff reductions last week as a way to reduce its costs in line with expectations of reduced revenue this year.

Wall Street investment analysts have urged the company to get its costs under tighter control as the company struggled with the $5.4 billion acquisition of ATI Technologies Inc. in late 2006 and with tougher competition from its larger and richer arch-rival Intel Corp.

Austin, which had 2,700 workers before the job cuts, is AMD’s largest non-manufacturing campus. The company employs about 3,500 workers in Dresden, Germany, where its major factory operations are located.

Austin is one of the company’s major sites for engineering, product design, marketing and administration. Most of the company’s senior management team lives and works here, even though AMD’s official headquarters is in Sunnyvale, Calif.

Top executives were expected to discuss the downsizing on a conference phone call with financial analysts this afternoon, after it reports first quarter financial results. AMD said last week that it will report quarterly revenue of $1.5 billion,below its original estimate.

AMD’s business was hurt last year when the company stumbled in introducing its two most important computer processor chips.

Those delayed chips are now shipping and analysts expect AMD’s sales will pick up over the next several quarters.

But competition from Intel, which is larger and richer and has introduced a series of strong products, remains fierce.

“Intel is coming at them from all sides with overwhelming firepower,” analyst Roger Kay with Endpoint Technologies Associates Inc. said last week.

Permalink | Comments (20) | Post your comment | Categories: Texas

Comments

By Jordan

April 17, 2008 2:39 PM | Link to this

Hopefully the city remembers this the next time they are considering approving an irresponsibly placed development on extremely sensitive land because of the “jobs” that it is said to provide.

By Mike

April 17, 2008 2:58 PM | Link to this

I am one of the 215 AMD employees that got laid off in Austin today. Although the toll is much higher if you consider contract workers. It sucks but it happens. Hopefully this will push me on to bigger and better things. Good luck to all of the AMD employees and contractors that got laid off, we will all need it.

By Charlie

April 17, 2008 3:20 PM | Link to this

As an ex-AMDer myself, all you guys are in my thoughts and prayers today. Hope those of you who were affected will land on your feet soon.

By keith

April 17, 2008 3:28 PM | Link to this

This is the way of the future….no longer do we work for the same company for years and years….we work for one for a few years until they get what they want out of us and then they get rid of us…..letting someone on the other side of the world do the job for 1/2 the cost, and ultimately end up destroying what we worked on so hard to achieve here. I would just hope that Congress one day starts punishing companies for laying off employees in the US and sending the job overseas….its not positive and shows the rest of the world is slowly overcoming the US

By frank

April 17, 2008 3:39 PM | Link to this

That’s what AMD gets for building on environmentally sensitive areas.

By Jeff

April 17, 2008 3:40 PM | Link to this

Jordan, let me guess, you own a house over this way. Your comments are foolish. What is irresponsible and what is so sensitive?

By Matahead

April 17, 2008 4:03 PM | Link to this

Michael “Billionare” Dell started his IT lay offs today. Moving ALL IT jobs to Bangalore, India!! Worked there, but not long enough to want to buy a computer, and never will. The top three layers make Way TOO Much Money! And because they can’t take a pay cut, I lost my job and hope of a little 1300 sqft house. My daughter doesn’t understand, how I could work til midnight for weeks, and now, be sent home early! Good part is I get a four day weekend with my baby!!

Are there tax benefits for sending money to under developed countries and jobs overseas to India?

By Jon

April 17, 2008 5:00 PM | Link to this

Unfortunately for some it is less expensive to employee workers inother parts of the world. Salaries in the US have risen to the point where it is difficult to justify employing people here in the States vs. overseas when the owners of the company (share holders) are solely interested in shareholder returns measure by payouts and earnings per share. I feel for those that must now find new jobs in this very difficult enviornment. Maybe Austin can slow or retreat some from the overpriced mecca it has become.

By Rocketeer

April 17, 2008 5:10 PM | Link to this

Jordan and Frank, you are both idiots. None of those laid off workers had one thing to do with the location of that plant, they were just doing the best work they can do so that you can sit behind a keyboard and espouse your uninformed drivel.

Some very good people lost their livelyhoods today. Hopefully, some local companies will take the oppertunity to grab some talent.

Regarding the upper management of AMD and their decisions over the last year, no comment.

By Robbie

April 17, 2008 5:23 PM | Link to this

Thank goodness for being employed by a DoD contractor, where most of the positions in the comany (including mine) require a secret security clearance and US Citizenship.

By Kevin

April 17, 2008 5:29 PM | Link to this

it is difficult to find good paying jobs nowadays unless you are willing to relocate to India.

By OTWB

April 17, 2008 5:59 PM | Link to this

I agree with Rocketeer, Frank, Jordon are idiots. I wonder how many poverty stricken Indians did they bulldozer over in India to build the facilities for US jobs. While a bunch of tree huggers whine about stupid a%# Golden Check Warblers or tadpoles that make better target practice than anything else, our jobs are slowly trickling away. It’s not that US workers make to much money, it’s because we have allowed our cost of living to go up with all the latest and greatest “stuff” that large parts of the world has done without. After all how much is your cost of living if you’re at Steiner Ranch or in a tent in India?

By Ben May

April 17, 2008 6:49 PM | Link to this

That Jobs Program the Chamber of Commerce has really works well. Instead of supporting innovation, that leads to jobs, they just steal some jobs from California. California steals some from us. Nobody wins.

Then, all the Chamber guys give each other Awards. Pathetic.

By Mike

April 17, 2008 6:58 PM | Link to this

It’s a shame that people kick other people when they are down. Those AMD employees put their hearts into their jobs and still get cut loose when the going gets tough. They have no say in anything over there. They work 60 to 80 hours a week. They deserve better. When did a tree become more important than person?

By walt s

April 17, 2008 7:51 PM | Link to this

good riddance AMD - too bad this happened after they built their greenwashed, oversized sprawling mess on top of the aquifer. Anyone could have seen this coming - just look at their stock price over the past 2 years. Prep the dynamite!

By Steve

April 17, 2008 8:49 PM | Link to this

I have friends at AMD. The anti-AMD comments here are irrelevant to the story of these real people who just lost their jobs.

I wonder how many of these folks have used or are using AMD products just by posting their comments here? I’m not just talking about the PC in front of them, but at every hop to the Statesman’s host.

I wonder also if they’ve researched Intel’s business practices to make sure they’re not doing everything they can to avoid harming the environment as well?

I think it’s time for these “environmentalists” to stop talking and start doing.

Just to make them happy, for the three wacko’s here, I’m putting three weeks of recycling straight into the trash. I’ll also drive with a lead-foot through three full-tank fill-ups. It’s fun and gives me some satisfaction that I’m doing something to p** these jerks off.

By Christine

April 17, 2008 9:16 PM | Link to this

These comments are outragous. How do you expect a company to sustain payroll when they are selling anything? How do you expect a company to make payroll when they don’t have any margin (because their competitors are based in another country with lower overhead and therefore higher margins)? Why would you want Congress to punish companies are shifting jobs overseas? What shouldn’t have happened is giving these companies massive tax breaks, but these cuts are NOT to grow executive pay packages— they are to invest back into the business and grow areas of the company producing products that consumers are buying!

Ugh. The situations sucks, but it is what it is.

Although, I hope whoever pushed the case to build the new facility in it’s current location was thrown out the door.

By Scott

April 17, 2008 10:58 PM | Link to this

The people that are applauding hard working Austinites loosing their jobs because AMD built on in the aquifer’s recharge zone are simply idiots. It is a shame AMD built above the aquifer, but this decision had nothing to do with the people that were laid off today. The executives, developers, and city of Austin officials that are responsible for AMD building in the aquifer’s recharge zone did not lose their job. The people who lost their jobs are hard working Austinites trying to make a living and provide for their families. It is difficult for me to understand how people get enjoyment from knowing this layoff will result in some people loosing their homes, or not being able to pay for their children’s education.

As an ex AMDer, it is heart breaking to see this happen. I know people at AMD put in unreasonably long hours, are incredible talented, and make great products. Competing against the Intel juggernaut is not easy. Let’s hope AMD can get it together and regain their focus. With Barcelona finally shipping there is at least some silver lining. HP and Dell have announced Barcelona based platforms, and indications are IBM and SUN will be soon to follow. With the native quad-core architecture, advanced virtualization capabilities, and superior performance per watt numbers there is no doubt that Barcelona is an impressive chip. AMD needs to execute and deliver higher speed and 45nm Barcelonas as promised (not to mention succeed with Phenom, Griffin / Puma, and ATI GPUs). To make matters worse Intel’s Nehalem CPUs should release later this year.

It’s really do or die. Abu Dhabi won’t keep bailing out AMD forever. For the sake of many Austinites’ jobs and the semiconductor industry in general, we’re all pulling for AMD. For those who lost their jobs, my heart goes out to you. I hope you find work quickly. Trust me; there are many better-managed, better-to-work-for tech companies in Austin.

By Francis

April 17, 2008 11:14 PM | Link to this

Layoff is a sad thing to happen but when the tree gets too big(relatively), trimming is in order. If you are good, you get snatched in a heart beat.

We all blame companies moving jobs overseas, but we never blame the low prices of goods we enjoy, stock dividends we receive, etc. because of cheaper labor in developing contries. It all runs a full circle… Wall street wants bigger profit, forcing companies to outsource to keep costs low. After all, it is share holders (all of us having stocks) who want more out of our investments. So who is to blame…. Please look at the mirror ? Solutions? Look at Europe. Stop the greed. Slow down and the world will last much longer!

By katie

April 18, 2008 8:57 AM | Link to this

What was really disgusting yesterday is that if you looked at the executive parking lot, several of the execs decided to leave their everyday cars at home and instead bring their A cars. Not cool to drive your Lotus to work the same day there were massive layoffs. And yes, with 75 VPs, the tree does need trimmed, but it wasn’t trimmed at the right places.

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