AMD posts $157m loss, will lay off 15% of workers this quarter
They said it was going to be bad, and they were right
One week ago, AMD warned investors that its financial results for its third quarter of 2012 were going to be worse than it had previously estimated, with revenues down about 10 per cent from the previous quarter rather than the 1 per cent, plus or minus 3 per cent, that they had forecasted earlier.
They were spot on – not that being correct about such a disappointing result will win them many friends on the Street.
After the markets closed this Thursday, AMD announced that its Q3 2012 revenues were $1.27bn, which hit that prediction of a 10 per cent quarter-to-quarter slippage.
That $1.27bn revenue figure, however, came in at the low end of the predictions made by 28 analysts surveyed by Yahoo! Finance. Those moneymen had
guessed calculated that revenues would come in somewhere between $1.27bn and $1.4bn, with the consensus estimate being $1.28bn.
The same worthies had predicted that AMD would lose 15¢ per share, with the least optimistic prediction being -34¢ and the most optimistic, -1¢. AMD wasn't even close to the consensus, however – it lost 21¢ per share in the quarter. In the year-ago third quarter, AMD had earned a positive 15¢ per share.
Overall, AMD's income was a negative $157m for the quarter, a steep drop from a positive $37m in the previous quarter and $97m in the same quarter last year.
Echoing remarks made by Intel president and CEO Paul Otellini when his company announced disappointing results for its Q3 2012 this Tuesday, AMD president and CEO Rory Read cited the ongoing transition through which the chipmakers are currently struggling.
"The PC industry is going through a period of very significant change that is impacting both the ecosystem and AMD," Read said in a statement. "It is clear that the trends we knew would re-shape the industry are happening at a much faster pace than we anticipated."
Those trends are not only reshaping the industry, but AMD's workforce as well. In addition to announcing its financial results, AMD revealed that it will reduce its global workforce by about 15 per cent during the current quarter. ®