Advanced Micro Devices' second quarter was notable for several reasons -- unfortunately for AMD, one of them was not an end to the company's long string of consecutive quarterly losses.
Reporting Sunnyvale, Calif.-based AMD's financial results Tuesday, CEO Dirk Meyer said the company's second quarter was its first with AMD the product company and its spun-off manufacturing arm, Globalfoundries, as fully distinct entities. Globalfoundries soon will break ground on a new silicon fabrication plant in upstate New York that will create 6,400 new jobs in the area, Meyer said.
But that news and a brighter outlook for the second half of 2009 couldn't mask the fact that once again, AMD has had to deliver bad news to investors, losing $330 million on the quarter. Though the chip maker dramatically narrowed its loss as compared to the second quarter of 2008, when it lost $1.2 billion, AMD's sales dropped by 13 percent year over year, from $1.36 billion to $1.18 billion.
AMD also did somewhat better in sequential terms -- in its fiscal first quarter, the company suffered a 21 percent decline in sales year over year. Adding the improved numbers from its just-concluded quarter, for the first half of 2009, AMD's revenue declined 17 percent against the same six months in 2008.
The better showing this quarter was thanks to new products such as AMD's Phenom II desktop processors, six-core Opteron server chips and 40nm graphics processors sold under its ATI brand, and perhaps also because end-user demand has "stabilized" during the global economic downturn, according to Robert Rivet, the company's chief financial officer.
AMD was somewhat cagey in its guidance for the third quarter and second half of 2009, but Meyer predicted that sales will be "up slightly" during the next three months.
"We are positioned for stronger financial performance in the second half of this year," he told analysts Monday.
AMD's archrival Intel, the leading maker of microprocessors in the world, posted its own second-quarter loss last week, primarily due to a $1.45 billion European Union fine for antitrust activities. It was Santa Clara, Calif.-based Intel's first quarterly loss in 22 years, but the chip leader did exceed expectations for revenue and gross margins.
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