AMD announced a third-quarter loss of $67 million, or 11 cents per share, on a revenue of $1.776 billion. Revenue was up 32 percent compared to Q2 2008 and 14 percent compared to Q3 2007.
Analysts expected AMD to report a loss of 40 cents per share on a revenue of $1.48 billion but AMD beat these expectations big time and even had an operational income of $131 million. However, the main reason why AMD surprised analysts appears to be a one-time process technology license revenue of $191 million that they've accumulated and added to their cash throughout the year. This revenue is related to the sale of old 200mm equipment to a Russian firm.
Guidance for the next quarter is flat due to economic uncertainty. Sales of GPUs are up 40 percent year-over-year and 55 percent compared to Q2 2008, and the firm also said quad-core shipments are up 46 percent.
AMD today reported third quarter 2008 revenue from continuing operations of $1.776 billion, including process technology license revenue of $191 million. Third quarter 2008 revenue increased 32 percent compared to the second quarter of 2008 and 14 percent compared to the third quarter of 2007.
In the third quarter of 2008, AMD reported a net loss of $67 million, or $0.11 per share. For continuing operations, third quarter 2008 income was $41 million, or $0.07 per share, including the process technology license revenue of $191 million, or $0.31 a share. Third quarter 2008 operating income was $131 million. Loss from discontinued operations was $108 million, or $0.18 a share.
In the second quarter of 2008, AMD had revenue from continuing operations of $1.349 billion, a net loss of $1.189 billion, a loss from continuing operations of $269 million and an operating loss of $143 million. In the third quarter of 2007, AMD had revenue from continuing operations of $1.558 billion, a net loss of $396 million, a loss from continuing operations of $344 million and an operating loss of $181 million.
“We achieved a significant milestone with the recent announcement of our Asset Smart strategy, which will transform both AMD and the industry through the creation of ‘The Foundry Company’,” said Dirk Meyer, AMD’s president and CEO. “AMD will be assured access to leading-edge manufacturing processes without the obligation to make the capital investment required to maintain a world-class manufacturing operation. We look forward to the successful closing of this joint venture early in 2009.”
“We are pleased to have reached our goal of operational profitability this quarter while increasing gross margin to 51 percent,” said Robert J. Rivet, AMD’s chief financial officer. “Improved execution across all of our businesses was punctuated by a refresh of our graphics product line-up, driving 55 percent sequential revenue growth and market share gains. In addition, customer adoption of our quad-core microprocessors was strong, with unit shipments increasing 46 percent sequentially.”
Third quarter 2008 gross margin was 51 percent, and 45 percent excluding process technology license revenue. This compares favorably to both the second quarter 2008 non-GAAP gross margin of 37 percent, and third quarter of 2007 gross margin of 41 percent.