Mubadala Provides AMD With Financial Room to Breathe
AMD apparently received a safety net from Mubadala Development, which reportedly increased its share in the company to 19 percent, in exchange for a cash payment and an additional seat on the company's board.
An analyst pointed out that this move could mean that Mubadala would bail out AMD, if it had to.
“If you have a lender of last resort like that, what’s the potential of you not having options?” said Cody Acree, an analyst at Williams Financial Group, in an interview with Bloomberg.
AMD is making adjustments to its business to sail through the current economic storm. The company refinanced a $485 million debt payment that was due in Q3; AMD announced that it would sell its Austin company campus for about $150 to $200 million, presumably to cover a $225 million payment that is due to be paid to Globalfoundries in Q1 2013; and a 15 percent cut of its workforce should positively influence its balance sheet further.
For the fourth quarter of 2012, AMD said it expects revenue to decrease by 9 percent sequentially.
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Wolfgang Gruener is an experienced professional in digital strategy and content, specializing in web strategy, content architecture, user experience, and applying AI in content operations within the insurtech industry. His previous roles include Director, Digital Strategy and Content Experience at American Eagle, Managing Editor at TG Daily, and contributing to publications like Tom's Guide and Tom's Hardware.
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blazorthon Bad management and they keep trimming everything other than management from what I'm reading :(Reply
AMD should get a clue about the management issue if they want good market share and higher profitability. -
joytech22 Poor AMD, really is a killer to see a technology giant slowly sinking.Reply
They have to rise back up, they just have to for the sake of the rest of us.
If one of every single enthusiast or general PC user spent $100 on one of AMD's CPU's, they would be out of trouble faster than you can say that really long word from Merry Poppins. -
BigBodZod I'm hoping for the best, however the ghost of CBM seems to have camped out at AMD these past few years...Reply -
warmon6 joytech22Poor AMD, really is a killer to see a technology giant slowly sinking.They have to rise back up, they just have to for the sake of the rest of us.If one of every single enthusiast or general PC user spent $100 on one of AMD's CPU's, they would be out of trouble faster than you can say that really long word from Merry Poppins.Reply
superfragilisticexpialidocious :p -
A Bad Day BTW, the company bailing out AMD is an investment vehicle of Abu Dhabi's government. It has quite a bit of assets and partners.Reply -
Companies that cut management as a last resort normally fail in the end.Reply
Overhead has to be reduced. -
A Bad Day Forbes did an article talking about why AMD failed: http://www.forbes.com/sites/michaelkanellos/2011/11/07/where-amd-failed/2/Reply
1. It lost trust in it's own employees.
2. It engaged in a losing price war against Intel, who had better fab plants on their side.
3. It failed to expand into new profitable markets. AMD APU was a good idea, but not good enough.