December 30, 2008 by Matt Thomas
Computer chip maker Advanced Micro Devices (AMD), has made 600 people redundant. The move had been widely predicted after a final quarter of 2008 that saw sales fall by 25 per cent from the previous quarter. To put that in perspective, that’s a difference of about $396 million dollars.
It can’t then, have come as a huge surprise to AMD’s employees that there would be redundancies, in fact the company had all but announced that 500 of its staff would be moving on. However, the fact that the eventual figure was considerably larger than that has come as a surprise to many.
The streamlining process will be far from cheap for AMD and is set to cost them around $34 million dollars in benefits and other severance payments. About $13 million more is expected to go on wrapping up projects and terminating contracts prematurely, closing down offices and factories will cost a mere $6 million. All of which wipes a cool $17 million off the value of the company’s assets as a whole.
Ironically, the cost-cutting plan is set to cost them $70 million all told, around $20 million more than they were expecting to spend.
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