Chipmaker AMD will cut staff by 7%

AMD's layoff news comes just a week after Lisa Su took over as CEO

AMD's new chief is making her mark quickly: By the end of 2014, the chipmaker will cut its worldwide head count by about 7% in a restructuring plan designed to put it on a path to improved profits.

The layoffs will start immediately and come just a week after AMD appointed former COO Lisa Su as the company's CEO. She replaced Rory Read, who had held the post since August 2011.

The company did not share specific plans about the restructuring or which parts of its business will be affected by layoffs. AMD employed 10,149 people at end of its third fiscal quarter on Sept. 27.

AMD has struggled over the past couple of years, reporting just a few quarters of profit. As a result of the layoffs and slashing costs such as real estate expenses, the company expects to save $9 million in the fourth quarter and around $85 million in fiscal 2015.

On Oct. 16, AMD reported third-quarter revenue of $1.43 billion, down 2% compared to the same quarter last year. AMD reported GAAP net income of $17 million, down from $48 million in the same quarter last year.

Chip sales into the PC market account for most of AMD's business. But with PC sales slowing down, the company is focusing more on the growing area of graphics chips and custom processors, and on devices such as gaming consoles. AMD is also revamping its server road map to include ARM processors.

Agam Shah covers PCs, tablets, servers, chips and semiconductors for the IDG News Service. Follow Agam on Twitter at @agamsh. Agam's email address is agam_shah@idg.com

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