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PC-market slump hits AMD in 3rd Quarter

AMD has Cut Chip Orders From Globalfoundries  after the global PC market has slumped.

 AMD who is the second-largest maker of personal-computer processors, after Intel has reduced chip orders from supplier its supplier Globalfoundries Inc, apparently in an effort to cut costs.

 

According to Bloomberg, AMD estimates it will purchase wafers from Globalfoundries for about $115 million in the fourth quarter, the new agreement replaces a previous agreement which said AMD would buy $500 million of chips.

In October, AMD forecast fourth-quarter sales that fell short of analysts’ estimates, putting the company on course for its fourth consecutive quarterly sales decline. The projection led analysts such as Sanford C. Bernstein & Co.’s Stacy Rasgon to predict that, if the trend continues, cash reserves may fall short of what AMD says it requires.

“Liquidity and cash management remain a key focus for AMD,” interim Chief Financial Officer Devinder Kumar said on a conference call.

The company predicts it will return to generating cash from operations in the second half of next year and can stay close to its target level of $1.1 billion in cash reserves, he said.

Globalfoundries was created as a spinoff of AMD’s manufacturing operations in a purchase by an investment arm of the government of Abu Dhabi. Sunnyvale, California-based AMD has operated under fixed-supply contracts that require it to make set payments to its supplier.

Terminating the contract to reduce the payments will cost AMD $320 million, to be paid off by the end of 2013. Of that total, $80 million will be paid in the current quarter, the company said.

New head of Global Channel Sales for AMD

AMD have announced that Roy Taylor has joined the company as corporate vice president and head of Global Channel Sales, reporting to Senior Vice President and Chief Sales Officer John Byrne. In this role, Taylor will be responsible for managing and growing AMD’s channel business globally.

“Roy is well known in the IT industry for his energy, his ability to identify new opportunities and his focus on delivering results,” said Byrne. “I am extremely excited to have him join our team to take our channel business to the next level. Roy’s enthusiasm and passion for technology evangelization will help strengthen our channel business as we bring new low-power APUs and discrete GPUs to market in 2013 that provide outstanding value, unmatched graphics capabilities and immersive user experiences.”

A 25-year industry veteran, Taylor has had a multi-faceted career as a technology evangelist, content strategist and entrepreneur in both start-ups and established companies. He joins AMD from Rightware, a Finland-based software start-up where he was chief sales officer. Prior to Rightware, Taylor spent a decade at NVIDIA where he held a number of leadership roles including vice president Telco Relations, vice president Content Relations and CTO for PCGA (PC Gaming Alliance), vice president for GPU Sales and vice president of EMEA Sales.

An avid gamer and IT enthusiast, Taylor started his career in the component distribution business and was a founder of Addtron, a firm representing sales and marketing for semiconductor leaders such as Aureal, IBM Microelectronics, NEC, Nexgen, and others in Europe. Taylor holds a bachelor’s degree in Business Studies from Maidstone College, Kent, United Kingdom.