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Chipmaker Advanced Micro Devices Inc. (AMD) is cutting around a thousand jobs in a bid to refocus on markets like artificial intelligence chips.
The company announced plans to reduce its workforce by 4%, translating to about 1,000 jobs out of its 26,000 employees as of the end of last year. It comes as Nvidia has begun to dominate the market, forcing rivals to pour resources into AI processors. Earlier this month, ReadWrite reported that Nvidia’s stock value soared to $3.6 trillion, putting the company ahead of Apple as the most valuable company in the world.
However, AMD has traditionally concentrated on processors for consumer PCs, where it competes directly with Intel Corp.
As reported by CNBC, an AMD spokesperson stated: ″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%.
“We are committed to treating impacted employees with respect and helping them through this transition.”
AMD refocuses on AI amid cuts
AMD ranks as the world’s second-largest GPU manufacturer, powering most AI workloads. Its top-tier GPU, the Instinct MI300X accelerator, offers a competitive alternative to Nvidia’s H100 and H200 GPUs for data center providers like Microsoft, Amazon, and Google.
Last month, AMD posted solid third-quarter results, exceeding expectations with an 18% revenue increase. However, its guidance for the current quarter fell short, leading to a stock drop of over 7%.
On an earnings call, AMD executives highlighted their expectation for AI chip sales to bring in about $5 billion this year, roughly one-fifth of total projected revenue. While the company expects the AI chip market will reach $500 billion by 2028, it remains uncertain how large a share AMD can secure.
In August, AMD announced the completion of its acquisition of Silo AI, the largest private AI lab in Europe. The all-cash transaction was valued at approximately $665 million. At the time, Vamsi Boppana, AMD senior vice president, stated: “AI is our number one strategic priority, and we continue to invest in both the talent and software capabilities to support our growing customer deployments and roadmaps.”
ReadWrite has reached out to AMD for comment.
Featured image: Ideogram
