Feeds

AMD bleeds red in Q1 after GlobalFoundries deal rejig

But sales not as bad as expected

Security for virtualized datacentres

PC and server chip maker Advanced Micro Devices didn't do as badly as expected in the first quarter, with revenues only down 1.7 per cent to $1.59bn.

But the red ink was deeper than usual in the wake of its restructuring of its relationship with fab partner GlobalFoundries, which cost AMD a $703m writeoff in the quarter. And thus, instead of posting a $92m profit, AMD posted a $590m loss.

The first quarter normally has a sequential decline for both AMD and archrival Intel, so a dip was not unexpected.

The Computing Solutions segment at AMD posted just a tad bit over $1.2bn in revenues in the first quarter ended in March, flat from the year-ago period. Operating income from this segment, which makes processors and chipsets for servers and PCs, actually rose by 24 per cent to $124m.

On the server front, Rory Read, AMD's CEO, said the Opterons "continue to make progress," and that this was the third consecutive quarter of growth for the server business at AMD. "We are fully committed building our server business, step by step, over the long haul," Read said several times in the call with Wall Street analysts. AMD gained a little market share against rival Intel in the server racket in the fourth quarter of 2011, and Read said that he believed AMD gained some share again in the first quarter, too.

Server processor shipments were up compared to the year ago period, but because AMD has slashed prices and is shipping a different mix of "Bulldozer" Opteron 4200s and 6200s, server chip and chipset revenues were down in Q1. The Bulldozer chips above now account for more than half of Opteron shipments and revenues, said Read.

AMD closed its acquisition of microserver and server interconnect upstart SeaMicro in the quarter, and will no doubt put its Opteron 3200 processors into the machines as quickly as it can. And perhaps others. After burning $293m in cash for SeaMicro (plus assuming another $43m in costs), AMD was sitting on a pile of cash that was $1.71bn deep.

Client chip shipments were down in the quarter, as were revenues and ASPs, as 45 nanometer products were being gradually replaced by hybrid CPU-GPU designs, which AMD calls Accelerated Processing Units, or APUs. AMD has shipped over 30 million of its "Brazos" APUs to date, and is getting ready to ramp-up its next generation "Brazos 2.0" and "Trinity" APUs this quarter with volume shipments by the back to school season.

Read said that a "steady supply of 32 nanometer parts" allowed AMD to meet its commitments to PC and server customers in the quarter.

AMD's Graphics division posted revenues of $382m in the first quarter, flat sequentially but down 7.5 per cent year-on-year. Operating income in graphics was up 78.9 per cent to $34m in the quarter. That middle line was 26 per cent higher than in Q4 2011, which had the same revenues for discrete graphics. Read said that the 28 nanometer ramp for discrete graphics cards for PCs was going well and "demand was strong."

GPU average selling prices were actually up in the quarter overall, thanks to improved sales of desktop GPUs through channel partners, which offset lower GPU sales to game console makers.

As is the case with rival Nvidia, AMD wishes it could get more 28 nanometer GPU parts from fab partner Taiwan Semiconductor Manufacturing Corp. Read said that AMD was "monitoring this closely" and was "going to track it week in and week out." ®

Security for virtualized datacentres

More from The Register

next story
Phones 4u slips into administration after EE cuts ties with Brit mobe retailer
More than 5,500 jobs could be axed if rescue mission fails
Israeli spies rebel over mass-snooping on innocent Palestinians
'Disciplinary treatment will be sharp and clear' vow spy-chiefs
Apple CEO Tim Cook: TV is TERRIBLE and stuck in the 1970s
The iKing thinks telly is far too fiddly and ugly – basically, iTunes
Huawei ditches new Windows Phone mobe plans, blames poor sales
Giganto mobe firm slams door shut on Microsoft. OH DEAR
Phones 4u website DIES as wounded mobe retailer struggles to stay above water
Founder blames 'ruthless network partners' for implosion
Found inside ISIS terror chap's laptop: CELINE DION tunes
REPORT: Stash of terrorist material found in Syria Dell box
Show us your Five-Eyes SECRETS says Privacy International
Refusal to disclose GCHQ canteen menus and prices triggers Euro Human Rights Court action
prev story

Whitepapers

Secure remote control for conventional and virtual desktops
Balancing user privacy and privileged access, in accordance with compliance frameworks and legislation. Evaluating any potential remote control choice.
Saudi Petroleum chooses Tegile storage solution
A storage solution that addresses company growth and performance for business-critical applications of caseware archive and search along with other key operational systems.
High Performance for All
While HPC is not new, it has traditionally been seen as a specialist area – is it now geared up to meet more mainstream requirements?
Security for virtualized datacentres
Legacy security solutions are inefficient due to the architectural differences between physical and virtual environments.
Providing a secure and efficient Helpdesk
A single remote control platform for user support is be key to providing an efficient helpdesk. Retain full control over the way in which screen and keystroke data is transmitted.