AMD confirms layoffs amid mixed Q3 earnings, impacting 4% of workforce

Advanced Micro Devices Inc. (AMD) has confirmed a strategic workforce reduction, impacting about 4% of its global staff, according to reports.

This move aligns with the company's intensified focus on the artificial intelligence (AI) sector and comes amid a mixed financial performance in the third quarter of 2024. The decision, initially disclosed on message boards and subsequently validated by AMD, follows a wave of job cuts across the tech industry, including similar actions by competitor Intel Corporation, which has faced profitability challenges in recent quarters.

On platforms like Team Blind and The Layoff, employees shared firsthand accounts of the impact, with one user remarking that while the news was unexpected, the severance offered was "generous."

As per reports, AMD confirmed the news, stating that the layoffs are part of a larger restructuring plan aimed at channelling resources into high-growth areas, particularly AI.

Despite an impressive 17% year-over-year increase in revenue and a 34% jump in profit during Q3, AMD's stock has taken a hit, dropping 13.6% since the earnings announcement. The third-quarter report highlighted a troubling decline in AMD's gaming division, where revenue plummeted by 69% annually to $462 million.

The layoffs also come at a critical juncture as AMD undertakes ambitious initiatives in AI. To support this expansion, AMD has pursued multiple acquisitions, financed through a mix of cash and debt, aimed at securing a competitive foothold in the burgeoning AI industry.

By consolidating resources and making targeted workforce reductions, AMD aims to align its capabilities with its AI-focused goals, positioning itself for long-term growth amid heightened industry competition.