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AMD Restructuring Costs Revealed

By - Source: Tom's Hardware US | B 9 comments

AMD’s cost cutting measures for this year have been brought to light in a U.S. Securities and Exchange Commission filing.

Back in December, details of the then recent layoffs and financial restructuring of Advanced Micro Devices were released via an SEC filing. The filing showed that the company laid off 600 people, 100 more than the initial figure of 500 a company spokesperson announced in November, which in turn had an effect on restructuring costs for Q4 as well as 2009. The extra hundred layoffs saw the company’s total cost of restructuring for Q4 shoot up to $70 million, $20 million more than the estimated $50 million earlier in the quarter. Reports said AMD would also need to make further cost reductions early in 2009 to compensate for the extra cash spent, however the company would not provide an estimate for this year’s 2009 costs.

Late last week another filing by AMD put a number on the cost estimates for 2009 at a nice, round $50 million, which will include approximately $23 million for employee severance and related benefits, $13 million for contract or program termination costs, $7 million for "asset impairments," and another $7 million site consolidations and closures. AMD went on to clarify that the restructuring will be complete by the end of FY09.

PC World cites Dunham Winoto, senior analyst for semiconductors at financial analyst firm Avian Securities as saying the company could have a rough time bringing operating expenses in line with revenue. AMD is set to announce its first quarter results for fiscal 2009 on April 21.

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  • 5 Hide
    The Third Level , April 6, 2009 2:24 PM
    I hope AMD makes it through this well, because I shudder to think of an Intel monopoly.
  • 0 Hide
    Greatwalrus , April 6, 2009 2:28 PM
    Hmm, I find it kind of ironic that AMD will launch the Phenom II 955 on April 20th, then on April 21st, they will announce their first quarter results :p 
  • 1 Hide
    The Third Level , April 6, 2009 2:45 PM
    GreatWalrusHmm, I find it kind of ironic that AMD will launch the Phenom II 955 on April 20th, then on April 21st, they will announce their first quarter results


    Probably so that if their Q1 results suck, they can just say "Oh yeah, the 955 is gonna make Q2 fucking SWEET!" :p 
  • 1 Hide
    deltatux , April 6, 2009 3:06 PM
    All my desktop systems are now AMD, supporting the competition is good, especially if the competition can lower prices and help innovate. Without AMD, the consumer loses. So no matter how much we may hate this company (talking to the fanboys), you need AMD to survive.
  • 0 Hide
    Anonymous , April 6, 2009 4:08 PM
    This is where the Intel monopoly lawsuits are relevant, when AMD was leading, Intel was using their size to illegally maintain their market share, had AMD gained as much market share(and profit) as they should have, they would be in a much better position today, with more money for R&D.
  • 1 Hide
    Greatwalrus , April 6, 2009 5:24 PM
    The Third LevelProbably so that if their Q1 results suck, they can just say "Oh yeah, the 955 is gonna make Q2 fucking SWEET!"


    That's exactly what I was thinking when I made the comment! :) 
  • 1 Hide
    Anonymous , April 6, 2009 7:52 PM
    At the moment AMD isn't asking for a bailout, and for the moment doesn't need one. And I hope it never reaches that point.

    Oh and, deltatux, why would you ever hate amd? Just don't get that one. It has garnered many breakthroughs in the industry, that intel now uses, legally so... it is part of the whole x86 architecture contract. Nor does it have questionable behavior, such as intel. I realize that intel, does put out a lot of quality products that are frequently faster than AMD's chips, but not always. But I don't see why that would give you a reason to hate AMD.
  • 0 Hide
    doormatderek , April 7, 2009 2:38 AM
    he NEVER said ANYTHING about hating AMD. READ before you post man. He said ALL his current systems are AMD, as are mine... jeesh...
  • 0 Hide
    anamaniac , April 8, 2009 1:36 AM
    I will likely by a PhenomII x3 as my next cpu (just because I'm cheap, and this 25% performance hit drops price by $100), though possibly a C2Q only because I'm buying a new LGA775 mobo.

    I love competition. I don't want either AMD or Intel to dramatically exceed each other. Both companies still need each other due to many licensing agreements as it seems.
    I like Intel because it gave me the PIMP Pentium D (which I can use a iron frying pan as a heatsink, olive oil for my liquid cooling, and sausages to make my system look and taste awesome), but I also like AMD because currently I believe they provide a better quad-core for the dollar to your average consumer.