AMD to Close Two Chip Plants, Cut Jobs
SUNNYVALE (Reuters) - Advanced Micro Devices Inc., the chief rival to Intel Corp. (Nasdaq:INTC - news) in the market for microprocessors, said on Tuesday that it will cut 2,300 jobs, or about 15 percent of its work force, and shutter two chipmaking plants in a bid to cut costs.
Sunnyvale, California-based Advanced Micro Devices (NYSE:AMD - news) said it will close two chipmaking plants, Fabs 14 and 15 in Austin, Texas. About 1,000 of the job cuts are associated with closing the plants in Austin. The remainder of the cuts will come from cuts in Penang, Malaysia.
As a result of the moves, AMD said it will take a third-quarter charge of $80 million to $110 million, adding that it expects to save $125 million annually.
AMD, along with Intel and the entire semiconductor industry has been battling slumping demand and slow personal computer sales due to slowing economies, particularly in the United States. Some market researchers see global chip sales declining as much as 34 percent this year in light of flagging demand.
Shares of AMD fell 59 cents, or 6 percent, to $9.22 on the New York Stock Exchange (news - web sites) before trading was halted pending the announcement. |
