Despite solid sales gains, AMD posts another loss for Q3
By Colleen Taylor, Contributing Editor -- EDN, October 18, 2007
Chipmaker Advanced Micro Devices Inc. (AMD) saw mixed results with its Q3 report released late Thursday that showed strong gains in sales but a lackluster income.
AMD said it saw Q3 sales of $1.632 billion, an 18 percent increase compared to Q2 and a 23 percent improvement from Q3 2006. However, AMD also reported an operating loss for Q3 of $226 million, and a net loss of $396 million; that's an improvement over Q2, when AMD saw an operating loss of $457 million and net loss of $600 million, but a downgrade from its Q3 2006 operating income of $121 million and net income of $134.56.
Despite the losses, AMD's executives publicly expressed pleasure with the results. "We are encouraged by the progress we made in our third quarter financial results," said Robert J. Rivet, AMD's CFO, in a statement. "We sold a record number of microprocessors through our distribution channel and began revenue shipments of Quad-core AMD Opteron processors in the quarter.
AMD's Q3 gross margin was 41 percent, compared to 33 percent in Q2 and 51 percent in the Q3 2006. The increase from the prior quarter was due to increased microprocessor unit shipments, manufacturing efficiencies, improved inventory management, and a richer product mix in the computing solutions and graphics segments, AMD said.
Looking ahead, AMD had a vaguely optimistic outlook for its Q4 performance. "In the seasonally up fourth quarter, AMD expects revenue to increase in line with seasonality," the company said.
Meanwhile, rival MPU maker Intel Corp. continues to bask in the aftereffects of the stellar Q3 report it released earlier this week. The company reported record Q3 revenue of $10.1 billion, and net income of $1.9 billion.
