AMD CEO Dirk Meyer points out the AMD Product Company, which excludes the foundry segment, achieved a non-GAAP net income of $2 million, thus delivering on his promise to return to profitability.
A breakdown of the revenue reveals computing solution sales were up 17 percent sequentially to $1,069 million, due to higher shipments and higher Average Selling Prices (ASPs) of processors. Compared to Q3 2008 computing solutions revenue is down 23 percent, mainly due to dropping ASPs. Sales of ATI graphics cards are up 22 percent sequentially to $306 million, units were up but ASPs down. Compared to the year-earlier period graphics card revenue is down 21 percent, mainly due to lower ASPs.
Earlier this week Intel announced third-quarter earnings of $1.9 billion on a revenue of $9.4 billion.
In the third quarter of 2009, AMD reported a net loss attributable to AMD common stockholders of $128 million, or $0.18 per share, which includes a net favorable impact of $54 million, or $0.08 per share, primarily from a $66 million gain from the repurchase of debt as described in the table below. AMD’s operating loss was $77 million.
In the second quarter of 2009, AMD had revenue of $1.184 billion, a net loss attributable to AMD common stockholders of $330 million and an operating loss of $249 million. In the third quarter of 2008, AMD had revenue from continuing operations of $1.797 billion, a net loss attributable to AMD common stockholders of $134 million and an operating income of $122 million.
In the third quarter of 2009, AMD Product Company reported non-GAAP net income of $2 million and non-GAAP operating income of $47 million. In the second quarter of 2009, AMD Product Company reported a non-GAAP net loss of $244 million and a non-GAAP operating loss of $205 million.
“Strong demand for our product and platform offerings combined with disciplined execution resulted in AMD Product Company achieving profitability in the third quarter,” said Dirk Meyer, AMD president and CEO. “Growth in microprocessor and graphics unit shipments drove an 18 percent sequential revenue increase, while improved factory utilization rates, higher microprocessor average selling price and an increase in 45nm product shipments resulted in a gross margin improvement from the prior quarter.”
Third quarter 2009 AMD gross margin was 42 percent compared to 37 percent in the prior quarter. Third quarter 2009 AMD Product Company non-GAAP gross margin was 38 percent compared to 27 percent in the prior quarter.
AMD’s outlook statements are based on current expectations. The following statements are forward looking, and actual results could differ materially depending on market conditions and the factors set forth under the “Cautionary Statement” below. AMD expects its Product Company revenue to be up modestly for the fourth quarter of 2009.