AMD makes massive Q4 loss
Misses revenue target
Advanced Micro Devices Inc reported a massive loss for its fourth quarter yesterday and failed to meet the raised revenue forecast it set itself back in December.
Although the Sunnyvale, California-based vendor saw increased shipments of its CPU and flash memory products, its already large operating losses were swollen by special charges, resulting in a total net loss of $854.7m.
The company sought to placate investors by predicting first quarter sales would be flat to nominally up, saying that it was on target to reduce its cost structure to below $800m, and by setting an April ship date for Opteron, the hybrid 32bit/64bit processor it hopes will launch it into the high end computing space.
In December, AMD raised its fourth quarter guidance, saying sales would be $700m. Yesterday it revealed sales actually came in at $686.4m, down 27.9% on the year. Operating loss was $560m, compared to a $17m loss a year ago, while net loss was $854.7m, compared to $15.8m a year ago.
The fourth quarter loss included charges of $331m relating to restructuring and asset impairments, $46m for R&D expenses, and an income tax expense charge of $243m to establish a 100% valuation allowance against net deferred tax assets. The company had predicted the restructuring and tax charges back in December.
For the year to date, sales were $$2.7bn, down 30.7% on the year. Operating loss was $1.2bn compared to a $58.3m loss a year ago, while net loss was $1.3bn compared to a $60.6m loss a year ago.