AMD Back In Black For A Second Straight Quarter

Advanced Micro Devices continued along its comeback path in the first quarter of 2010, reporting 34 percent year-over-year revenue growth and a second straight quarter of profitability.

"Strong product offerings and solid operating performance resulted in record first quarter revenue," said Dirk Meyer, president and CEO of Sunnyvale, Calif.-based AMD, in a statement Thursday.

AMD had first-quarter sales of $1.57 billion, up from $1.18 billion in the first quarter of 2009, with net income of $257 million, gross margin of 47 percent and earnings per share of $0.35.

The chipmaker saw its net income slip considerably from the fourth quarter of 2009, when it had profits of $1.18 billion, though that figure was heavily bolstered by a one-time, $1.25 billion payment from rival Intel to settle the two companies' long-running legal dispute over Intel's business practices.

With its second straight profitable quarter, AMD further solidified its emergence from a three-year period in which the company suffered a string of consecutive quarterly losses. Furthermore, an important part of AMD's return to profitability -- the spin-off of the company's chip manufacturing business, Globalfoundries -- was finalized in the just-completed quarter.

"The deconsolidation of Globalfoundries is complete," Meyer said in a conference call with financial analysts.

Revenue for AMD's Computing Solutions segment, the unit that sells the chip maker's client and server CPUs, was up 23 percent as compared to the first quarter of 2009. Sales were up 88 percent year-over-year for AMD's Graphics segment, comprising the ATI families of integrated and discrete GPUs.

Next: Magny-Cours Give AMD A Boost

AMD began shipping its next-generation Opteron 6000 series server chips, code named Magny-Cours, towards the end of the first quarter. Meyer said those eight-core and 12-core chips for dual-socket servers and above put AMD in "probably in the best competitive position we've been in since 2006."

During the first quarter, AMD also expanded its family of Direct X 11-compatible graphics products and began shipping its next-generation notebook platforms to customers, he said.

Looking forward, AMD offered guidance for "revenue to be down seasonally for the second quarter of 2010." Turning to AMD's product roadmap, Meyer said the chip maker has started to sample one of its two future-generation Fusion processor designs to select partners.