Much improved sales but chip maker still posts $43m loss

Laptop chips boost AMD

AMD has reported a 40 per cent jump in second quarter revenue, largely off the back of strong sales of mobile computing parts.

The Intel competitor benefited from sales of both processors and graphics parts amid expectations that the third quarter will be better still due to an expected seasonal uplift in demand. The results follow the news that rival Intel reported its best ever quarter results particularly in the server area where AMD has traditionally lagged.

However the company has also launched new server CPUs which have met with a degree of success in a difficult market. The company said that the new parts including the 12-core Opteron server chip, should also show substantial gains in the following quarter. 

Having acquired graphics specialist ATI in 2006, the graphics section of the business has been on a roll with continued design wins in the laptop space for the firm’s graphics components. In fact shipments had been held back by supply constraints which again are due to ease in the following quarter. 

Off the back of such good results from the ATI brand, $43 million loss doesn’t tell the whole story since this is largely due to a $120m equity loss from the company’s ownership of Globalfoundries. Excluding the Globalfoundries loss, the company made a profit of $83m which is a significant turn around from the $335m loss from the same quarter in the previous year. 

AMD’s results reflect a change in accounting treatment for Globalfoundries, a new company bankrolled by investors from Abu Dhabi that includes AMD’s former manufacturing operations. The company recorded a $120 million equity loss stemming from its 28% ownership in Globalfoundries in the second quarter.

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