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Upgrade push could be the salvation of long struggling AMD

In business, just like in real life, companies can be a victim of expectations.   Fortunately for chipmaker Intel it handily beat the estimates of Wall Street's top researchers, reporting its best quarter ever.  On Tuesday night after the closing bell Intel reported a Q2 2010 revenue of $10.8B USD, handily topping the $10.25B USD predicted by analysts.

Chipmaker AMD, the David to Intel's Goliath, had some good news of its own on Thursday.  The company posted a net loss for Q2 2010 of only $43M USD, $110M USD less than the loss widely predicted by Wall Street.  AMD reported revenue of $1.65B USD, where analysts had predicted it to pull in only $1.54B USD.  It also posted a promising Non-GAAP earnings were $83M USD.

AMD has benefited from its success in the GPU segment, and, like Intel, by a strong upgrade cycle demand for CPUs.  AMD credits stronger demand for notebook CPUs and GPUs as a major source of its turnaround.  With its latest results, AMD inches closer to finally crawling out of the money pit it has long been languishing in.  In fact, if the current results are any indication, AMD may return to profitability within a quarter or two.  

Ultimately, AMD and Intel are being buoyed up by a strong upgrade push both in the desktop and notebook sector.  A major part of this push is thanks to Windows 7, Microsoft's latest consumer operating system that is earning unanimous praise from reviewers and customers alike.

While some worry about the upgrade craze dying down, it seems likely to continue strong for some time while so many customers still have Windows XP.  Additionally, businesses will likely slowly jump onboard the upgrade train as they look to transition to Windows 7.  If Microsoft can replicate Windows 7's success with Windows 8, the outlook for both Intel and AMD may continue to be just as rosy.

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By bbomb on 7/16/2010 11:33:20 AM , Rating: 0
God damn you people need to learn how to read. Yes he did get the millions and billions thing mixed up. They reported a net loss of 43m or whatever. You do know that you can have income and lose money right? People do get paychecks yet are still in debt.

They had income of 1.65 billion but that income was 43 million short of what they needed to break even.

So yes retards, you can have income and make a loss if you spend more than what the income is.

By sprockkets on 7/16/2010 12:08:22 PM , Rating: 3
You do know that you can have income and lose money right? People do get paychecks yet are still in debt.
Wrong. You can't have both net income and net loss, and that's what was in the article.

Stop calling us retarded, retard.

By OUits on 7/16/2010 12:12:34 PM , Rating: 2

bbomb is mixing up net income with revenue.

Maybe he doesn't know what net refers to?

By lewisc on 7/16/2010 6:02:14 PM , Rating: 2
You can have a positive net income (generally regarded as income net of operating costs) but still make a loss after tax and financing costs. In fact, it's pretty frequent, especially when the costs of finance are high.

I've not seen AMDs accounts so I'm not indicating whether the article was right or wrong, just pointing out that from an accounting perspective, the two are not mutually exclusive.

By OUits on 7/16/2010 8:09:28 PM , Rating: 2
No, you can't.

What you're referring to is Operating Income, or Earnings Before Interest and Taxes.

Net income takes into account both taxes and 'financing costs' aka interest expense.

By rwei on 7/16/2010 12:20:45 PM , Rating: 4
(1) As another poster stated, you can't have both net income and net loss. Gross income and net loss, sure.
(2) You seem to be mixing up a combination of:
- cash
- revenues
- income
- debt

If you actually want to have a discussion of financial topics, you have to be VERY careful about your language.

And before you call other people retards...consider taking an introductory accounting class.

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