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Advanced Micro Devices reported dramatic losses in first quarter revenues, which executives called unacceptable. AMD also delivered a rough draft of a restructuring plan that will return the company to its former status, executives said.
AMD recorded operating and net losses of $504 and $611 million, respectively, or $1.11 per share. AMD recorded revenue of $1.23 billion, down 30 percent from the fourth quarter and 7 percent from a year ago.
That larger-than-expected loss was the topic of a conference call April 19 in which Dirk Meyer, president and chief executive of AMD, said AMD would be undertaking some major restructuring efforts to deal with what he described as “an increasingly complex CPU business.”
“After 14 consecutive quarters of gaining share in the CPU business, the first quarter was a major setback in the strategic transformation of our company,” Meyer said during the call. “But we know, the only way to get healthy is to fully understand our problems and fix them.”
Those problems, according to Meyer, had mainly to do with “growing pains,” pricing pressures, and some “mix and delivery issues.”
During the call, he said that with AMDs past success has come increasing complexity in the form of more customers, more channels, and more businesses.
“The game is really quite different,” Meyer said, “and frankly, that complexity is has led to some challenges for us.”
“Starting roughly in the middle of last year, we suffered occasional mix and delivery issues in the course of serving new and expanding relationships with global OEMs,” Meyer went on.