Friday, July 18, 2008
Advanced Micro Devices Inc. experienced what company executives described as a "disappointing" performance in the second quarter as the company posted its seventh consecutive quarterly loss despite efforts over the last year by the microprocessor supplier to regain its footing after tripping up on manufacturing execution.
In contrast to the strong financial results reported two days earlier by rival Intel Corp., Sunnyvale, Calif.-based AMD posted a hefty $1.2 billion net loss for the quarter ended June 28, compared with a smaller $600 million net loss for the comparable quarter in 2007.
The company said its net loss per share for the June quarter widened to $1.96 from $1.09 in the year-ago quarter. Revenue for the quarter rose 3 percent to $1.35 billion, from $1.31 billion in the second quarter of 2007 but declined 7 percent on a sequential basis from the $1.46 billion posted in the March quarter. The results fell below analysts' average estimate for revenue of $1.45 billion.
Despite signs more of the company's products are winning slots in OEM computers as it improves manufacturing execution, AMD still appears to be far from completing its ongoing recovery.
The company's outlook for the third quarter, for instance, was for "revenue to increase in line with seasonality," a vague forecast that could be interpreted to mean single-lower double-digit sales hike for the period.
AMD acknowledged the disappointing results in a statement but noted that it expects financial results to improve in coming months.
"While we had a disappointing quarter financially," customer adoption of our recently introduced microprocessor and graphics products and platform offerings is strong, and we see increasing momentum across our businesses," said Robert J. Rivet, chief financial officer at AMD in a statement.
"In the face of challenging macroeconomic conditions, we remain committed to achieving profitability in the second half of the year based on the continued ramp of new products, increased market penetration of our differentiated solutions and continued actions designed to reduce our breakeven point," Rivet added.
As part of its ongoing reorganization, AMD said it will divest the handheld and DTV businesses and will begin "classifying them as discontinued operations for financial reporting."
By: DocMemory
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