AMD Announces Plan to Restructure Ahead of Earnings Report

Vikingod · Apr 10, 2007, 11:34 AM

Source: DailyTech
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AMD is due to issue its Q1 earning report ten days from now, but the company announced today that it will have to restructure its business to compensate for a substantial drop in quarterly revenue. Revenue for Q1 is expected to come in at $1.225 billion USD; down from the projected $1.6 to $1.7 billion USD.

In response to the reduced earnings, AMD will reduce its capital spending by $500 million USD and will "significantly reduce" its discretionary spending. Likewise, the company will limit new hires to "critical" positions.

The restructure comes amidst a resurgent Intel which has been cranking out 65 nanometer quad-core Xeon and Core 2 products while at the same time trimming prices across the board. AMD is still months away from releasing its 65nm response to Intel's quad-core server processors; however, the company has countered on the pricing front which has resulted in ASP erosion.

Apr 10, 2007, 11:34 AM	#1
Vikingod Int'l Fish Liaison Join Date: Jul 2004 Location: By the light of lamp I sit and type... Posts: 16,197 Rep Power: 112 System Specs	AMD Announces Plan to Restructure Ahead of Earnings Report Source: DailyTech _____________ AMD is due to issue its Q1 earning report ten days from now, but the company announced today that it will have to restructure its business to compensate for a substantial drop in quarterly revenue. Revenue for Q1 is expected to come in at $1.225 billion USD; down from the projected $1.6 to $1.7 billion USD. In response to the reduced earnings, AMD will reduce its capital spending by $500 million USD and will "significantly reduce" its discretionary spending. Likewise, the company will limit new hires to "critical" positions. The restructure comes amidst a resurgent Intel which has been cranking out 65 nanometer quad-core Xeon and Core 2 products while at the same time trimming prices across the board. AMD is still months away from releasing its 65nm response to Intel's quad-core server processors; however, the company has countered on the pricing front which has resulted in ASP erosion.