updated 11:45 pm EDT, Thu July 17, 2008
AMD posts loss, CEO leaves
AMD on Thursday posted disappointing second quarter results, citing a net loss of $1.189 billion, or $1.96 per share, while also announcing that CEO Hector Ruiz would step down from his position. In terms of continuing operations, the net loss was posted as $269 million (44¢ per share), with operating losses at $143 million. Net favorable impact sits at $97 million (16¢ per share), while losses from discontinued operations came in at $920 million ($1.52 per share) and impairment charges at $876 million ($1.44 per share).
While the losses were saddening, AMD highlighted that its quad-core Opteron processors are currently residing in over 30 platforms, such as HP, IBM, Dell, and Sun. Opterons are also found in three of the top five, and seven of the top 20 supercomputer systems, out of a total list of 500. AMD also chose to point out its next generation of graphics chipsets from ATI, as well as several companies who pride themselves on joint AMD/ATI-based system, including Acer, HP, and Toshiba.
Hector Ruiz was removed as CEO for the company, with CNN Money citing an eight month delay in the Opteron's successor - resulting in current stock price-cuts - and the financial burden that the $5.6 billion acquisition of ATI Technologies brought, now that the company is worth half of what AMD paid in 2006. COO Dirk Meyer, who has been partially overseen operation of the company alongside the former CEO, will succeed Ruiz. While this could be a boon, due to Meyer's familiarity with the company's inner workings, it also holds equally negative connotations, given AMD's recent losses.
Ruiz will not leave the company, but will maintain a position on AMD's board of directors.
As potential cost-cutting measures, AMD expects it could sell some of its factories, or severing the business and tech units in charge of chips for consumer electronics and cell phones.