In an internal memo, the president and COO of AMD, Dirk Meyer, has lamented the lay-off of 10% of the company's workforce, but says the action will result in a "brighter future in the second half of this year".
Meyer's memo, leaked to freelance journalist Mike Magee, says the redundancies are a last resort and necessary if the chip manufacturer is to recover from poor Q1 results and achieve its future objectives.
The memo is as follows:
Fellow AMD employees,
In Q1 our revenue fell short of internal expectations in each of our businesses. And while we remain confident about our strategies and new product offerings this year, we must take action now to bring our cost structure in line with our performance.
Subsequently, we are moving forward with staff reductions of approximately 10 percent of AMD’s total workforce starting in mid-April and to be completed by the end of Q3. The reductions will be determined by a review of employee performance, skill requirements and functional needs.
As Hector and I have said, headcount reductions are among the last actions we would undertake to help AMD recover and achieve our objectives. The unfortunate truth is that we have been unable to grow our revenues to justify our cost structure, and the uncertain environment requires us to adjust our cost structure to match lowered revenue expectations.
While this action is a painful one, it is necessary in order to put us back on path to success. Thank you for your patience and cooperation, as we drive towards consistent profitability and a brighter future in the second half of this year.