Advanced Micro Devices will lay off about 200 employees over the next 60 days.
The chipmaker notified the employees, all workers at its Fab 25 manufacturing plant in Austin, Texas, this week, a company spokesman confirmed Friday. AMD has about 3,800 employees in Austin.
The layoffs stem from a plan to switch the plant, which currently produces AMD's Duron processor for PCs, to the manufacture of flash memory. That type of memory is used to store data in cellular phones and other electronic devices.
AMD says the plan will help extend the life of Fab 25 while the company shifts processor production to its much newer Fab 30 in Dresden, Germany. Fab 30 produces all of the company's Athlon chips and some Duron chips as well.
The chipmaker has already begun the transition to flash at Fab 25 and expects to complete it by the end of this year. But manufacturing flash is less labor-intensive than making processors, the company spokesman said.
"Flash requires fewer employees than manufacturing processors," he said.
Meanwhile, the company is winding down operations at its Fab 14 and Fab 15 plants in Austin as part of a previously announced plan to close the aging plants to cut costs. AMD said last September that about 1,000 employees would lose their jobs as a result of the closings. The plants mainly manufacture chips for other companies.
AMD also gave notice to some of the remaining Fab 14 and Fab 15 employees this week. The company has said it plans to close those facilities by the end of June.