AMD Returns to Profitability After 12 Quarters of Losses

For the past three years, Advanced Micro Devices can't be said to have been the best performing IT company, at least not as far as finances are concerned. For 12 consecutive quarters, the Sunnyvale, California-based chip maker has been on a steady decline, losing more than it was earning. Back in the third quarter of 2009, though, the antitrust settlement with Intel ended up filling its stash with $1.25 billion, which helped it stabilize somewhat. Now, whether it was thanks to that sum or not, the CPU and GPU maker has posted a “record first quarter revenue” and seems to have once again started to return a profit.

During the first three month of the current year, AMD's revenues amounted to 1.57 billion and the net income to $257 million. This corresponds to EPS $0.35 and an operating income of $182 million. The company also reported a gross margin of 47%, with the non-GAAP margin being of 43%. Overall, this past quarter's revenues dropped compared to the 1.65 billion in Q4 2009, explainable through seasonal trend. Finally, marketable securities, cash and cash equivalents rose sequentially, from $1.77 billion to $1.93 billion.

"Strong product offerings and solid operating performance resulted in record first quarter revenue," said Dirk Meyer, AMD president and CEO. "We continue to strengthen our product offerings. We launched our latest generation of server platforms, expanded our family of DirectX 11-compatible graphics offerings, and commenced shipments of our next-generation notebook platforms to customers."

Graphics revenues decreased 3% sequentially, because of “ seasonal decline in royalties received in connection with the sale of game console systems,” but rose 88% year-over-year, thanks to a surge in GPU sales (obviously owed to DirectX 11 graphics cards). Similarly, the computing segment rose by 23% on-year but fell 5% sequentially. Moving forward, Advanced Micro Devices expects its second quarter revenues to be down seasonally.