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AMD Gets Kicked While It's (Still) Down

Updated from 12:46 p.m. EST

SAN FRANCISCO -- Longtime investors in chipmaker Advanced Micro Devices (AMD - Get Report) are used to disappointment -- why not end 2008 with another bleak signpost for the months ahead?

The company reported late Monday in a Securities and Exchange Commission filing that it laid off 100 more workers than expected during its most recent quarter (a total of 600), which would also result in a charge of $70 million, $20 million more than previously projected.

That's not the really disappointing part -- for investors, not for the additional 100 now without jobs -- and it even led one media outlet to post the unfortunate headline earlier Tuesday " Intel (INTC - Get Report), AMD Lead Broad Advance by Chip Issues."

AMD shares ended Tuesday's trading session up 11 cents, or 5.2%, to $2.21.

(By the way, it's probably time for a couple of business journalism versions of " "Man Laws": 1) A 4-penny rise by a $2 stock should never be called an advance, and 2) the words "AMD" and "lead" should, going forward, never be used in the same sentence.)

Yes, taking another $20 million out of AMD's coffers isn't good, and the idea that 100 more bodies had to be cut doesn't say much for future demand, but you have to give AMD props for scaling down costs amid a dire economic slowdown. The company still employs about 16,000 workers.

Here's the real kicker: AMD will once again be writing down the value of goodwill related to its 2006 acquisition of graphics chipmaker ATI Technologies, following an updated outlook for that business. How much of a writedown? The company has no idea. "The Company expects that the impairment charge will be material, but, as of the time of this filing, the Company is unable to estimate the amount or range of amounts of the impairment charge," AMD said in the filing.

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