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AMD to cut jobs, institute temporary pay cuts

Dawn Kawamoto CNET News

Published: 19 Jan 2009 08:45 GMT

AMD announced on Friday it would cut its workforce by nine percent and institute temporary salary cuts from its executive chairman down to hourly workers.

AMD will cut 1,100 positions in the first quarter through attrition and layoffs as one of its measures to cut costs during the economic downturn.

The chipmaker will also institute temporary salary cuts, with its chief executive Dirk Meyer and executive chairman Hector Ruiz both taking a 20 percent cut. In the US and Canada, executives that hold a rank of vice president or higher will receive a 15 percent pay cut and salaried workers a 10 percent cut. Hourly workers, meanwhile, will face a five percent wage reduction.

Voluntary pay cuts will be sought at AMD's offices outside the US and Canada, as allowed by local governments there. The company will also halt its 401(k) match.

AMD is the latest tech titan to announce a round of job cuts. Earlier this month Motorola announced a six percent cut of 4,000 workers, drafting and design software maker Autodesk a 10 percent cut affecting 750 employees, and even search giant Google announced cuts of 100 workers.

The chipmaker's financial performance is under pressure. Last month, it warned Wall Street its fourth-quarter revenue would come in significantly lower than previously expected.

AMD is scheduled to report its fourth-quarter results on Thursday.