updated 09:22 pm EDT, Thu July 18, 2013
AMD financial plummet slows, profitability return expected this year
Chip and graphic card maker AMD today announced revenue for the second quarter of 2013 of $1.16 billion, an increase of seven percent from last quarter but a drop of 18 percent year-over-year. Additionally, an operating loss was noted of $29 million with a net loss of $74 million, or $0.10 per share. While still a loss, the results are less dramatically bad than expected by analysts and Wall Street, and the company is expected to return to profitability by the end of this calendar year.
"Our focus on restructuring and transforming AMD resulted in improved financial results," said Rory Read, AMD president and CEO. "Our performance in the second quarter was driven by opportunities in our new high-growth and traditional PC businesses. Looking ahead, we will continue to deliver a strong value proposition to our established customers and also reach new customers as we diversify our business. We expect significant revenue growth and a return to profitability in the third quarter."
Computing Solutions segment revenue increased 12 percent sequentially, but decreased 20 percent year-over-year. The sequential increase was due to significantly-higher notebook unit shipments and higher server and desktop unit shipments. The year-over-year decline was driven by overall lower unit shipments and microprocessor average selling price. The company noted a drop of one percentage point in gross margin, to 40 percent. AMD's Graphics and Visual Solutions segment revenue decreased five percent sequentially and 13 percent year-over-year. GPU revenue was flat sequentially and declined year-over-year.
For the third quarter of 2013, AMD expects revenue to increase 22 percent, plus or minus three percent. In the third quarter, AMD expects channel restrictions on the A-series and FX-9590 processors to lift. The fourth quarter will see release of the AMD-powered Xbox One and Playstation 4.