AMD reports more job cuts, sees new ATI charge

AMD has revealed it laid off about 600 people in the fourth quarter of 2008 as it struggles to return to profitability. This is 100 job cuts more than originally planned and, as a result, the company now expects to record $70 million in restructuring charges versus the $50 million it previously predicted. Severance payments and other benefits will cost the chip maker $34 million, $13 million will be spent on ending contracts and programs, approximately $17 million is connected to asset impairments, and about $6 million is related to exit costs at facilities.

Further cost reductions in the first half of 2009 are also planned but the company said it was unable to provide an estimate at this time. In addition, AMD also said it would incur an undetermined material write-down in the quarter for its October 2006 acquisition of ATI and a $20 million impairment charge for its investment in flash memory chip maker Spansion.