Nov 13 (Reuters) - Advanced Micro Devices ( AMD ) is

laying off 4% of its global workforce, or about 1,000 employees,

as it directs efforts towards developing AI chips in a bid to

compete against industry bellwether Nvidia ( NVDA ).

AMD is regarded as the closest rival to Nvidia ( NVDA ) in the

lucrative market for chips that form the brains of complex data

centers that can process the large mounds of data used by

generative AI technology like OpenAI's ChatGPT.

"As a part of aligning our resources with our largest growth

opportunities, we are taking a number of targeted steps," an AMD

spokesperson told Reuters on Tuesday.

Revenue in AMD's data center segment, which houses its AI

graphics processors, jumped more than two-fold in the September

quarter. On the other hand, the personal computer segment grew

29%, while sales in its gaming unit slumped about 69% during the

period.

Analysts expect the data center unit to grow 98% in 2024,

outpacing expected total revenue growth of 13%, according to an

average of estimates compiled by LSEG.

The company has been investing heavily to develop AI chips

which command high selling prices and are in high demand among

so-called hyperscalers like Microsoft ( MSFT ).

AMD plans to start mass production of a new version of its

artificial-intelligence chip called the MI325X in the fourth

quarter of the year. Ramping up production of AI chips is an

expensive undertaking due to constrained manufacturing capacity.

The company's research and development costs jumped close to

9% in the third quarter, while its total cost of sales rose by

11%.

Shares of AMD have dropped more than 3% so far this year, as

the company struggles to live up to investors' high expectations

after Wall Street drove a two-fold surge in its shares last

year, betting on the returns linked with AI technology.