AMD posts another quarterly financial loss, but the results show some improvement over AMD's performance from a year ago. While AMD executives did not offer details, they say they expect a better second half of 2009. AMD plans to focus on its new Opteron processors for servers, as well as on new notebook platforms.
posted another quarterly financial loss July 21, but the chip
maker's results were better than a year ago and the company plans to improve
its position with new Opteron processors for servers, as well as several new
posted a loss in the second
financial quarter of 2009, CEO Dirk Meyer
offered some cautious optimism for the second half of 2009. In the first half
of the year, Meyer said AMD worked on
controlling its costs, which could pay dividends in the second half of the year
if the overall world economy improves.
"With a strong flow of new products and a leaner cost structure,
coupled with assumption of modest seasonal growth, we are positioned for a
stronger financial performance in the second half of this year," Meyer said
during a call with financial analysts.
For now, Meyer
said AMD would focus on its new generation of Opteron processors for server
By the fourth quarter of 2009, the majority of AMD's
Opteron processors should have been switched to 45-nanometer manufacturing.
In addition, AMD plans to launch several
new platforms for laptops in the third quarter. One of these platforms is
"Tigris," which is geared toward mainstream
notebooks. AMD also plans to roll out a new
platform for what the company calls "thin and light" notebooks.
AMD also plans to focus on its ATI
graphics technology in the second half of 2009, especially its support for Microsoft's
DirectX 11 technology for Windows 7,
as well as graphics for the
professional workstation market.
For the second financial quarter of 2009, AMD
reported a net loss of $330 million or 49 cents per share. Revenue for the
quarter hit $1.18 billion. Wall Street analysts had called for a net loss of 47
cents per share and revenue of $1.13 billion.
Although AMD has reported yet another loss,
the latest numbers were improved compared ith a year ago, when the chip maker
posted a net loss of $1.95 billion or $1.97 per share and revenue of $1.35
John Spooner, an analyst with Technology Business Research, told eWEEK in an
e-mail that AMD's numbers were a positive
sign that the company might be ready to turn itself around.
"The chip maker, like its rival Intel, showed sequential improvement in
revenue," Spooner wrote. "Unit shipments fared reasonably well, with
some improvement in the server space. Thus there are signs that point to AMD's
business improving and the company marching toward its goal of becoming
profitable (at least on a quarterly operating basis) in the second half of the
However, there were troubling signs in AMD's
quarterly report, Spooner wrote. These included falling prices for the
company's laptop processors as consumers shop for cheaper notebooks and less
What AMD's latest quarterly results mean
for the semiconductor market and the overall IT industry are murky since no one
is sure when consumers and businesses will begin buying hardware, such as PCs,
in significant numbers again.
However, there are some signs that at least the chip industry is
Earlier in July, Intel reported solid second-quarter numbers, including $8
billion in revenue and nearly $1 billion in profits. Although Intel
had to report the quarter as a loss due to a massive fine from the European
the numbers seemed to indicate a better second half for Intel
and maybe for the entire semiconductor industry.
On July 20, research company iSuppli released a report showing that after
several quarters of significant declines, global chip inventories were expected
to only decline 1.5 percent in the second quarter of 2009, as semiconductor
companies adjusted their inventories and cut chip prices.
At the end of the second quarter of 2009, global chip inventories stood at
about $25 billion after peaking at $32 billion in the second quarter of 2008.
The iSuppli report also predicted that worldwide chip revenues should
increase about 7 percent in the second quarter after declining nearly 19
percent in the first quarter of 2009. Revenues are expected to increase 10
percent in the third quarter and approximately 5 percent in the fourth quarter.