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Chip maker AMD is laying off 1,000 employees as it pivots towards developing AI chips to compete against rival Nvidia.
As reported by Reuters, the cuts account for 4% of its global workforce. Nvidia shares have soared during the AI boom as its GPUs are harnessed to power the tech, leaving its rival AMD playing catch-up.
“As a part of aligning our resources with our largest growth opportunities, we are taking a number of targeted steps,” an AMD spokesperson said.
Struggling stock prices
AMD’s data centre segment revenue more than doubled in the September quarter, driven by demand for its AI processors. Meanwhile, its PC segment grew 29%, while gaming unit sales dropped around 69%.
Analysts project the data centre unit to grow by 98% in 2024, well above AMD’s anticipated overall revenue growth of 13%.
Despite strong data centre performance, AMD’s stock is down over 3% in 2024 as the company strives to meet high investor expectations. While shares surged last year on AI optimism, AMD has yet to fully deliver on projected growth.
