AMD axes 4% of staff while staring hungrily at AI, servers

LLM, LLM on the wall, who will be laid off first of all?

AMD has confirmed plans to cut approximately four percent of its global workforce - about 1,000 jobs out of a total headcount of roughly 26,000.

This comes right after the Ryzen designer put out its third-quarter financial results, which were pretty solid: $771 million in net income on $6.8 billion in revenues – a year-over-year increase of 158 percent and 18 percent, respectively. Despite this, the Epyc house says it is making some cuts so it can focus on key growth areas: Namely AI and the enterprise markets.

The layoffs do follow a tough quarter, on paper at least, for AMD's gaming division, which saw revenue drop 69 percent year-over-year. The culprit? The chip giant attributes this to declining "semi-custom revenue," which in plain terms means the demand for its system-on-chips for things like PlayStation and Xbox consoles has fallen.

This is to be expected: Pretty much everyone who wants an AMD-powered console that's been on sale has one at this point, so revenue will drop off until a future generation of hardware using Team Red's silicon arrives and is snapped up by gamers.

In contrast to AMD's cuts, Intel's recent round of layoffs has hit on a much larger scale, with around 15,000 jobs cuts across multiple business divisions as it tries to right the ship so to speak after some really rough quarters.

Compared to Intel, AMD's approach looks more like taking a scalpel to its operations, painful as it is to individuals laid off, whereas Intel's is more akin to putting departments through a wood chipper. AMD argues its cutbacks aren't a sign it's struggling financially. Instead, it's more about refocusing its resources towards higher-margin products, with the move aimed at accelerating its AI and datacenter strategies rather than a broader overhaul, or so we're told.

We asked AMD for comment on the layoffs, and a spokesperson told us:

As part of aligning our resources with our largest growth opportunities, we are taking a number of targeted steps that will unfortunately result in reducing our global workforce by approximately 4%. We are committed to treating impacted employees with respect and helping them through this transition.

When speaking to AMD, we did ask outright if this was just a "cost-cutting measure," but the spokesperson reiterated that they are simply aligning its resources with its largest growth opportunities in AI and enterprise.

In regard to where the layoffs might come from within the corporation, AMD was coy with stating which teams it specifically was trimming down, as they went on to say: "We are taking targeted actions across various functions in the company." ®