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AMD reports a $580m loss as graphics sales fall

Couldn't take advantage of 28nm head start
Fri Apr 20 2012, 11:29

CHIP DESIGNER AMD reported a loss of $580m with revenue falling marginally from a year ago as graphics card sales fell by seven per cent.

AMD had a relatively quiet quarter in terms of new products with the highlight being its purchase of Seamicro. While AMD was busy buying one of the hottest properties in the server scene, its sales stagnated at $1.59bn, a fraction lower than in the same period last year, while it recorded a $580m loss.

Despite AMD's eye-watering $580m loss, the firm's CEO Rory Read said the financial results were solid. "AMD delivered solid results in the first quarter as we remain focused on improving our execution, delivering innovative products, and building a company around a strategy to deliver strong cash flow and earnings growth. A complete top-to-bottom introduction of new APU offerings, combined with ample product supply resulting from continued progress with our manufacturing partners, positions us to win and grow," said Read.

Although AMD will claim that revenues would be slightly higher than a year previously if it was a 14-week quarter, the fact is that for much of the quarter the firm's hottest product, the Radeon HD 7970 graphics card, was in limited supply. Such were AMD's supply problems that the firm said revenue from graphics was down seven per cent from 2011, not a good sign given that it was top dog until Nvidia's Geforce GTX 680 launched at the tail end of the quarter.

AMD said it paid $703m to Globalfoundries for limited exclusivity on its 28nm process node for accelerated processor unit (APU) chips. The firm is also expected to release its Trinity APUs soon, which will incorporate a GPU design based on its current Radeon HD 7000 series architecture, with the company claiming that production of the chips has ramped up.

Given AMD's success with its Llano APUs, it needs to ensure that Trinity-based laptops appear in large numbers at launch if it doesn't want to report another quarter of damaging losses. µ

 

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