Chipmaker AMD to cut about 500 global jobs

AMD, which sells central processing units and graphics chips used in personal computers, in July lowered its revenue estimate for the second quarter.

NEW YORK: Struggling chipmaker Advanced Micro Devices Inc said it would cut about 500 jobs, or 5 percent of its global workforce, as the company looks to rein in costs amid weak demand for its chips used in personal computers and intense competition.

The company said it would record $41 million of the expected $42 million charge in the third quarter ended September.

AMD said it expected savings of about $58 million in 2016 from the restructuring plan.

The restructuring includes outsourcing certain IT and application development services, the company said in a regulatory filing on Thursday. (http://1.usa.gov/1M4Dj2A)

Sunnyvale, California-based AMD had about 9,700 employees at the end of last year, according to its latest annual filing from February.

AMD, which sells central processing units and graphics chips used in personal computers, in July lowered its revenue estimate for the second quarter, citing weaker-than-expected demand for PCs.

The company has also been shifting to gaming consoles and low-power servers, but progress has lagged Wall Street expectations due to intense competition from Intel Corp and newer companies.

Shares of AMD were flat at $1.74 in after-hours trading. - Reuters