AMD Plunges Back in the Red, Posts Gloomy Outlook
January 25, 2012 12:42 PM
comment(s) - last by
AMD at least has the release of Trinity, Southern Islands to look forward to
Advanced Micro Devices, Inc.'s (
) new CEO Rory Read said AMD is working to be a company that "consistently delivers on its commitments."
It looks as though the company has a bit of work left to do.
its earnings for (calendar) Q4 2011 late Tuesday and the result was a clear miss. Versus much of the rest of 2011 [
], where it posted profits, Q4 saw a $177M USD net loss when the results were adjusted to the general acceptable accounting practices (GAAP), the U.S. accounting standard.
Revenue stayed constant from Q3 2011 at $1.69B USD. This is a fairly substantial miss from the analyst consensus earnings target of $1.71B USD [
Aside from a slightly depressed gross margin (down 1 percent), the net loss comes largely due to a set of charges (losses). AMD took a $209M USD impairment charge on its investment in the GlobalFoundries chip fab, a $24M USD payment to GlobalFoundries charge, and a $98M USD general restructuring charge. AMD
began laying off some employees
in Nov. 2011.
AMD warns that the situation will get worse, with weakening demand expected for H1 2012. It's predicting$1.56B USD in Q1 2012 revenue. Previously, analyst targets had hovered around $1.7B USD, but they've since been adjusted down to a slightly more optimistic $1.59B USD.
The chipmaker saw graphics revenue dip 10 percent, with mobile GPU sales down. This dip may be compensated in H1 2011 by the official availability of
the Radeon 7000 HD series
). In the good news department, AMD's "computing solutions" department surged 7 percent in sales, keeping revenue steady from Q3 2011. AMD says its server and chipset sales have improved.
Picture top to bottom:
, the Fusion APU
(middle), and the
are expected to launch in 2012 and give a boost to AMD's revenue
's on-die GPU is partially derived
). [Image is property of DailyTech/Jason Mick]
In total, AMD made a net income (annual profit) of $491M USD in 2011, up modestly from 2010, a critical turnaround year for the firm.
Looking ahead AMD's gloomy forecast is definitely cause for caution. However, substantial excitement is surrounding AMD's next-generation
ultrathin-geared "Fusion" accelerated processing units
AMD is looking to stay aggressive with pricing, allowing for sub-$500 ultrathin laptops. Assuming AMD can keep its volume of the new chips high, it could see strong sales based on this attractive price point. AMD is confident that its APUs will beat similar Intel Corp. (
in price, battery life, and graphics, though it concedes that
will likely have more computing power.
AMD shares were puzzling trading 2.6 percent higher, despite the earnings miss and despite the general market being down about a quarter of a percent.
FT [analyst predictions]
This article is over a month old, voting and posting comments is disabled
1/26/2012 3:14:56 AM
Agree with the "good enough" point, in as much as that 's what many people need, and recognise that too. I don't think that many people could argue with it.
The problem is, AMD aren't the only manufacturers of processors in this bracket.
Intel make the best processors, and they also make good enough processors that compete at a similar price point to AMD, so is it any wonder that people see that brand and want to go with it, at whatever level they can afford?
AMD don't offer much at the top end for people to aspire to, or it be associated with. People will often prefer to by a cheap version of a performance brand rather than one that has just become about being "good enough" and that alone. And sales people will always find selling a performance brand easer too, and want to focus there.
Unless AMD really go for the good enough thing and market it very cleverly, rather than hoping that people will really work this out themselves and/or the big PC retailers and manufacturers will do it for them, things are only going to continue to get worse for AMD.
"Mac OS X is like living in a farmhouse in the country with no locks, and Windows is living in a house with bars on the windows in the bad part of town." -- Charlie Miller
CES 2012: Prepare for Sub-$500 Ultrathins: AMD's Fusion Trinity, Pictured
January 15, 2012, 12:15 PM
CES 2012: Intel -- 2012 is the Year of the Ultrabook
January 9, 2012, 12:05 PM
AMD Regains Single-GPU Performance Crown From NVIDIA, For Now
December 22, 2011, 2:07 PM
Quick Note: AMD To Trim Workforce by 10%, Expects $200M Operational Savings
November 3, 2011, 9:35 PM
AMD's Q3 Profit Constrained by Manufacturing Problems
October 28, 2011, 8:29 AM
ZOTAC Announces Diminutive ZBOX PI320 pico
August 27, 2014, 9:00 AM
Quick Note: QNAP Announces $129 QGenie 7-in-1 NAS for Mobile Users
July 14, 2014, 9:32 AM
Apple Launches 21.5” iMac with 1.4GHz Core i5 Processor Priced at $1,099
June 18, 2014, 8:07 AM
Lowe's "Holoroom" Brings Holodeck, Home Improvement Dreams Closer to Reality
June 13, 2014, 9:06 AM
Intel to Broaden Market for Fanless Tablets, Ultrabooks with 14nm Intel Core M
June 3, 2014, 10:42 AM
ZOTAC Announces Four New Silent ZBOX Mini-PCs
June 2, 2014, 9:21 AM
Most Popular Articles
HTC Preps Nexus 9 With Nvidia K1 64-Bit "Denver" SoC, Android L Onboard
September 10, 2014, 10:21 PM
Quick Note: Buy an Xbox One Sept 7-13, Get a Free Game
September 4, 2014, 10:42 AM
Apple Announces Its Smartwatch: The $349 Apple Watch
September 9, 2014, 2:09 PM
Dell Announces "World's Thinnest" Tablet: The Venue 8 7000 Series
September 11, 2014, 8:51 AM
T-Mobile Launches Un-carrier 7.0, Beefs Up Wi-Fi Calling
September 11, 2014, 2:56 PM
Latest Blog Posts
ISIS Imposes Ban on Teaching Evolution in Iraq
Sep 17, 2014, 5:22 PM
Space Terrorism is a Looming Threat For the United States
Apr 23, 2014, 7:47 PM
Facebook Aims to Provide Internet to "Every Person in the World" with Drones, Satellites
Apr 1, 2014, 10:20 AM
Retail Mobile Sites Experience Outages in Light of Simplexity's Bankruptcy
Mar 14, 2014, 8:48 AM
Tesla vs. BMW: Who Has the Safer EV?
Feb 1, 2014, 2:56 PM
More Blog Posts
Copyright 2014 DailyTech LLC. -
Terms, Conditions & Privacy Information