AMD guts PR team; move portends more changes


— 10:43 AM on November 4, 2011

We knew yesterday's news of mass layoffs at AMD would involve lots of people—roughly 1,400—losing their jobs around the globe, never a happy development. We understood the situation to be wide-ranging when news filtered in of some executive layoffs, including marketing guru Patrick Moorhead and graphics product manager Carrell Killebrew, whose role in the RV870's development was famously chronicled at AnandTech. What's become clear in the hours since the announcement is that some parts of the company were definitely hit harder than others.

One of the areas hardest hit is the relatively high-visibility public relations team, which has been reduced to a shell of its former self. We've worked with AMD's PR and reviews team extensively over time, of course, and happen to know quite a few of the people who worked there. All evening and into this morning, the tweets, emails, IMs, and Facebook posts have kept coming in as members of that team have notified folks they are no longer at AMD. From what we can gather, virtually the entire team has been gutted, with only one high-ranking manager from the graphics group confirmed to be remaining. We've heard those who were let go had no sense it was coming, no warning that the layoffs would be this deep or affect the entire group.

The timing seems particularly harsh given the fact that most of the individuals involved had just finished working very hard on one of the most difficult tasks in the industry: introducing a grossly underperforming product—the Bulldozer-based FX processors—to the public.

In a particularly prickly bit of irony, some early news stories about the layoffs were laced with disingenuous spin. They laid the blame for AMD's problems on the health of the overall PC market in the face of rising interest in smart phones and tablets. That interpretation seems rather warped, given that Intel enjoyed record earnings in its latest quarter, as part of a string of record performances, and Microsoft did, too. The data seem to indicate PC growth has slowed among consumers, but growth does continue.

An early AP story that offered the tablets-and-phones spin has since been updated with a more nuanced version, and one senses that the sentiments expressed about the state of the PC market came directly from the top at AMD. Thus, the updated story includes some interesting indicators about what's next for AMD. Apparently the company's board has a definite mission for its new CEO:

Read's job in large part is to help devise a strategy for AMD to penetrate computing markets where it and rival Intel Corp. have been largely absent. The battle has taken on a new dimension as AMD's and Intel's market share in PCs has reached a steady balance for years -- Intel's chips are in about 80 percent of the world's PCs, and AMD's are in essentially the rest.

Not having much presence in mobile devices has hurt AMD more than Intel because of its smaller size and it was a key reason AMD ousted Read's predecessor, Dirk Meyer, in January.

The firm's future is beginning to look like it will be focused on ever-smaller integrated chips, like the Brazos APU, intended for smaller, lower-power computing devices.

The question now is whether AMD will continue to participate robustly in its traditional markets for desktop PCs, workstations, and servers—and if so, whether it intends to field truly competitive products in the high-end and mid-range segments where Intel has been so difficult to defeat in recent years. Whipping the Bulldozer microarchitecture into shape, given its current competitive position, would likely involve a substantial ongoing investment. If there is a major shift to low-power and mobile-oriented devices, the relatively successful desktop graphics business could be another casualty—although that's just speculation at this point.

Eventually, Read and his rapidly forming new executive team will have to articulate a new strategy to AMD shareholders and the general public. Given everything we've seen to date, we expect sweeping changes in AMD's direction to be announced, once that time comes.

Update 1:55PM: We have confirmed that AMD has retained at least three senior members of its PR staff. However, we've also learned the cuts appear to have affected marketing nearly as deeply as PR. We're still trying to confirm some departures.

Also, according to the purported email about the layoffs sent to AMD employees, new CEO Read plans to "share more insights into our strategy and path forward in my upcoming Worldcast on November 9th."

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