AMD has announced today that it will be spinning off its back-end assembly and testing operations into a joint venture with Nantong Fujitsu Microelectronics (NFME), netting the company $371 million.
The joint venture will be 85% owned by NFME, with the remaining 15% retained by AMD. All of AMD's assembly, test, mark and pack operations will be spun out into this joint venture, along with two production sites – in Pengang, Malaysia, and Suzhou, China – and 1,700 employees.
The good news here is that there will be no workforce reductions in the set-up of this joint venture, ensuring all AMD staff working in back-end testing and assembly will remain employed. The deal is expected to close in the first half of 2016, so long as the usual approvals are secured.
This move sends more of AMD's chip production facilities away from the company, following the sale of chip fabrication facilities to GlobalFoundries in 2009. While AMD does gain some cash as part of the deal, it will have to deal with this new joint venture in the testing and assembly process of chip production moving forward.
AMD also announced Q3 2015 revenue of $1.06 billion today, which is a 26% decrease on the same quarter last year. This led to the company posting operating and net losses of $158 and $197 million respectively, including a $65 million write-down of older-generation APU inventory. Revenues are expected to decrease further in Q4, according to AMD.