AMD Posts Higher First Quarter Revenues, Profit

By Therese Poletti, San Jose Mercury News, Calif.

Apr. 12–Advanced Micro Devices reported a surge in revenues in the first quarter, as the chip maker said it gained market share with more business customers adopting its chips for computer servers, desktop computers and laptops.

For the first quarter ended March 26, AMD revenues jumped 8.6 percent to $1.33 billion, up from $1.23 million a year ago. Excluding year-ago sales of the company’s memory chip business, which was spun off in December as a separate public company called Spansion, revenues jumped 70.5 percent.

The Sunnyvale company also said it had higher average prices in the first quarter, compared to the fourth quarter, fueling higher profits.

Net income was $185 million, or 38 cents a share, including $15 million in stock options expensing, and another $20 million expense to partially redeem some notes. This compares with a net loss of $17.4 million, or a loss of 4 cents a share, in the first quarter a year ago.

AMD’s earnings were far better than Wall Street had been expecting. According to Thomson First Call, the consensus estimate among analysts was 29 cents a share, excluding any charges or gains.

“AMD had another great quarter,” said Robert Rivet, AMD’s chief financial officer, in a statement. Rivet said AMD believed that it again gained more market share based on strong customer demand for its AMD64 chips.

AMD also forecast that its second quarter sales will be flat to slightly down compared with the first quarter.

Contact Therese Poletti at tpoletti@mercurynews.com or (415) 477-2510.

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