The source, who asked not to be identified, told Reuters the company's second round of big layoffs in a year would be close to a range of 10 percent to 20 percent.

Technology blogs including CNET and All Things D reported earlier that AMD could cut between 20 percent and 30 percent of its workforce.

As of February, AMD had 11,705 employees worldwide.

Citing sources, All Things D reported that AMD could announce the cuts next week, that they could include employees from engineering and sales, and could be deep enough to require AMD to scale back some products.

AMD declined to comment.

Like its larger rival Intel, AMD was caught flat-footed in recent years with the emergence and fast growth of mobile devices like Apple's iPad.

Tablets and smartphones, once considered a niche market by Intel and others, are fast gaining consumer acceptance and eating into the sales of laptops and desktop computers, while a slowing global economy is dampening spending in general.

On Thursday, AMD warned that its third-quarter revenue likely fell about 10 percent from the previous quarter. AMD is due to report its financial results on October 18.

AMD and Intel have been slow to adapt their PC chip designs to mobile. But while Intel has poured its massive resources into efforts to catch up to smartphone chipmakers like Qualcomm, AMD has yet to define a clear mobile strategy.

The chipmaker has also been plagued by execution setbacks that have led to a loss of market share to Intel and to graphic chip rival Nvidia.

Last year, the company appointed a new Chief Executive Office, Rory Read, and one of his first major moves was to announce a plan in November to slash 10 percent of its workforce to save about $200 in operating costs.

Shares of AMD were up 0.72 percent in after hours trade. They closed down 14.37 percent at $2.74 earlier on Friday, hammered by the company's revenue warning the day before.

(Reporting By Noel Randewich; Editing by Carol Bishopric)

• A Permanent Economic Emergency