AMD has announced the move at the time when it is facing stiff competition from its closest rival, Nvidia, in the AI chip market
Advanced Micro Devices (AMD) has announced a 4 per cent jobs cut in its global workforce, which will impact nearly 1,000 employees of the chipmaker. The company reportedly said the step is aligned with its aim to make the most out of the growth opportunities amidst increasing competition, particularly from chipmaking giant Nvidia. It also said that it will ensure support to the affected employees.
“As a part of aligning our resources with our largest growth opportunities, we are taking a number of targeted steps that will unfortunately result in reducing our global workforce by approximately 4 per cent,” said an AMD spokesperson in a statement. “We are committed to treating impacted employees with respect and helping them through this transition,” the spokesperson added.
The move by the company has come at a time when it is facing stiff competition from its closest rival, Nvidia, in the AI chip market, particularly in AI training workloads. Nvidia’s shares this year are up by nearly 200 per cent whereas AMD’s stocks are down by 5 per cent. To up its game, AMD has planned to start bulk production of a new version of its AI chip called the MI325X in the last quarter of this year. MI325X AI chip will compete against Nvidia’s data center graphics processors (GPUs).
“AI demand has actually continued to take off and actually exceed expectations. It’s clear that the rate of investment is continuing to grow everywhere,” said AMD CEO Lisa Su at an event.
While the company is putting its best foot forward to give tough competition to Nvidia, its third-quarter results were below experts' projections. Its revenue increased 18 per cent year-over-year to $6.82 billion. Net income was up from $299 million in the same quarter in 2023 to $771 million in Q3 in 2024. Its data center segment doubled on an annual basis to $3.5 billion in total sales, while overall data center revenue was up 122 per cent year-over -year basis.
“Customer and partner interest for MI325X is high. Production shipments are planned to start this quarter,” said the CEO, according to a CNBC report.