AMD reported sales of $1.23 billion in the first quarter of 2005, compared to $1.26 billion in the fourth quarter of 2004 and $1.24 billion a year ago.

"Our microprocessor business delivered record sales in what is typically a seasonally down quarter, driven by increased sales across all product categories," said Robert J. Rivet, AMD's chief financial officer, in a statement.

"The NOR flash memory market continued to experience industry-wide oversupply and strong pricing pressure," he said. "We experienced a rise in unit shipments, but our average selling price declined significantly, resulting in weaker than expected sales."

First quarter operating loss was $46 million as compared to operating profit of $61 million in the first quarter of 2004 and $20 million in the fourth quarter of 2004.

The Computation Products Group sales of $750 million were up 31 percent from the first quarter of 2004 and increased 3 percent from $730 million in the fourth quarter of 2004. CPG generated record operating income of $92 million in the first quarter, up from $89 million in the fourth quarter of 2004.

Memory Group sales of $447 million decreased 29 percent from the first quarter of 2004 and decreased 11 percent from $504 million in the prior quarter. The Memory Group incurred an operating loss of $110 million, as compared to an operating loss of $39 million in the fourth quarter of 2004.

Spansion LLC, the flash memory venture of AMD and Fujitsu, has filed for an IPO with the Securities and Exchange Commission, likely indicating AMD is jettisoning its unprofitable memory unit.