AMD Cutting CPU Production

Hoping to raise demand above supply.

If you read our recent Phenom II X4 940 Black Edition review and fancied one for yourself then now might be the time to purchase because word has it that AMD is planning to cut its CPU production. According to ExtremeTech, the plan is to reduce the number of ‘unwanted’ chips floating around.

The aim is that by temporarily slowing processor production, AMD will avoid an oversupply of inventory at a time when sales are slowing anyway. Production will then be resumed once demand peaks back above availability.

As AMD’s chief financial officer, Rob Rivet, put it: “We’re slowing everything down quite a bit“. AMD CEO, Dirk Meyer, echoed Rivet’s sentiments, explaining: “we think our CPU sales out of AMD will be less than consumption… our inventories will drain in Q1 – we’ll clearly be manufacturing below our shipment level.

Whether these supply reductions will be universally applied, or in specific areas is unclear. Both Rivet and Meyer hinted that oversupply was greatest in the notebook sector, but shutting down productions across-the-board could well be the most financially beneficial option for the company.


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