AMD (NYSE:AMD) announced its sixth straight loss. For the first quarter of 2008, the company reported a net loss of $358 million, or 59 cents a share, compared with a net loss of $611 million, or $1.11 a share, for the year-earlier period.
MarketWatch writes "Revenue was $1.5 billion, up from $1.23 billion for the year-ago period. Analysts had expected the chipmaker to report a loss of 48 cents a share on revenue of $1.52 billion, according to FactSet Research."
The company's survival as an independent company remains at stake. The firm said that second quarter results would be down.
AMD still carries long-term debt of over $5 billion and with operating losses it remains difficult to see how the company can attack an amount of that magnitude while still investing aggressively in R&D. Larger rival Intel (NASDAQ:INTC) has the balance sheet and cash flow to continue to launch new chips, many of which have features superior to those of AMD products.
AMD may have only two choice now. One would be to sell the company to a more successful chip operation like Nvidia (NASDAQ:NVDA). The other is to auction off its graphics chip operation ATI, and hope that it can get enough money to help take down a large portion of its long-term debt obligations.
Either way, AMD is unlikely to look that same as it does now by the end of the year.
Douglas A. McIntyre is an editor at 247wallst.com.
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Reader Comments (Page 1 of 1)
4-18-2008 @ 8:56PM
john said...
So perhaps buying ATI was a mistake? It would be a shame if Advanced Micro left us, who would compete against Intel?
4-18-2008 @ 12:57PM
B said...
Man, that are some uninformed comments. How about some research beyond CNBC and Q reports.
Sell to Nvidia? They wouldn't know the first thing about handling AMD's cpu segment.
Better research is needed before posting headlines like that. How about reading something from people who know a thing or two about computing:
http://www.pcper.com/article.php?aid=547
4-19-2008 @ 6:08PM
degmd said...
One need only ask, does AMD have a roadmap that will be successful in the market and competitive with Intel? The answer is most assuredly YES. The idea that AMD will die trying because there will not be enough time to execute is severely flawed because it is not forward-looking, and even if it were, the investors behind the recent AD cash infusion are not likely to let that happen if it is only a matter of having more time; and that is exactly what it is. Long-term, AMD is an incredible value play right now.