AMD plans to slash 10% of its workforce in response to poor financial results, reports Reuters.
The 1,680 job losses will come after a poor first-quarter financial performance, well below previous expectations.
AMD said it expected to post first-quarter sales worth about £750m for the three months that ended 29 March.
Although this would be a rise of 22% from the same quarter a year ago, it would represent a 15% drop from the fourth quarter.
AMD is said to have lost market share against larger rival Intel, although Intel has issued its own warnings about its forthcoming results.
Intel will reveal its latest figures on 15 April, while AMD will confirm its figures on 17 April.
AMD is currently suing Intel over alleged uncompetitive behaviour in a long-running legal case.