AMD saw its first profitable quarter in three years in the fourth quarter of 2009, thanks in large part to the $1.25 billion legal settlement with Intel. However, AMD CEO Dirk Meyer says most of the company's business units-including servers, notebooks and discrete graphics-saw strong gains.
Advanced Micro Devices, on the strength of its $1.25 billion legal
settlement with Intel in December, turned a profit in the fourth quarter of
2009, the chip maker's first quarterly profit in three years.
AMD saw a $1.18 billion profit on almost
$1.65 billion in revenue, according to numbers the company released Jan. 21.
Compare that with the fourth quarter in 2008, when AMD
lost $1.44 billion. Revenue was 18 percent higher than in the third quarter in
2009 and 42 percent higher than fourth-quarter revenue in 2008.
Dirk Meyer, in a conference call with reporters and analysts, said it was a
"solid quarter," adding that the numbers in most of the company's
business units were up.
Like officials at rival Intel, which on Jan. 14 reported soaring financial
numbers, Meyer said AMD saw demand in
several areas increase, including laptops and servers, aided by businesses'
adoption of the six-core
Istanbul sales accounted for 60
percent of AMD's server revenues, and are
giving the company momentum in the competitive two-socket server space, he
said. The chip also is giving AMD a greater
presence in the HPC (high-performance
computing) and cloud cluster environments.
Meyer also touted the excitement around AMD's
portfolio of discrete ATI Radeon 5000
graphics products, and touched on the company's concerted push farther into the
laptop space, where he said AMD is
That is paying off, he said, pointing to Lenovo's January rollout of its
running both Athlon Neo and Turion chips.
The settlement with Intel was key for the company in several ways, not the
least of which was it included the $1.25 billion payment that AMD
was able to use to begin reducing debt. It also included a five-year cross-licensing
agreement that will let AMD reduce its stake
in Globalfoundries, the company created with Abu Dhabi's
Advanced Technology Investment Co. when AMD
spun off its manufacturing business.
Meyer said AMD in the fourth quarter saw
enterprises beginning to refresh their aging IT hardware, as illustrated by the
interest in Istanbul and OEMs'
interest in building notebook PCs for businesses. He mentioned two Lenovo
ThinkPads aimed at small and midsize businesses as examples.
However, both he and AMD Chief Financial Officer
Thomas Seifert were hesitant to predict whether that enterprise refresh push would
continue into the first half of 2010.
"Some enterprises are clearly looking to upgrade some of their
infrastructure now," Meyer said.
He said the company was on track to release its "Maranello" server
platform, which will feature "Magny-Cours" Opterons that will have up
to 12 processing cores.