14 DAY TRIAL // Intel may have done well during the July-September period, scoring a profit and a rise in CPU sales, but Advanced Micro Devices doesn't seem to have weathered the storm that well. Its financial results show as much.
Sure, the Enterprise, Embedded and Semi-Custom business unit managed to experience an increase in operating income compared to the second quarter, but it was still a revenue drop compared to last year.
More importantly, the Computing and Graphics unit fell 6% on quarter and 16 percent on year, due to weaker chipset and GPU sales. Lower demand for laptops is to blame here.
The operating loss was of $17 million / €13.3 million, which was almost three times as much as what was lost in the second quarter.
It's kind of a kick to the teeth after the apparent progress that AMD has been experiencing, although we suppose that the company's reorganization wasn't going to be all sunshine and rainbows.
The CEO change should have probably been a hint as well, but by all accounts Rory Read is only leaving because it was always the plan, and he'll stay as advisor until the end of the year anyway.
All in all, AMD ended the quarter with a revenue of $1.43 billion / €1.12 billion, 2% lower than the money accumulated during the same period of the previous year.
What this means going forward
For one thing, AMD has to do something to strengthen its performance in the Computing and Graphics business unit, but there aren't any concrete change plans in place. None that we know anyway.
And that's the not so bad news if you can believe it. The worse news is that AMD will cut down its workforce a bit during the remaining months of the year.
AMD has already fired a fair number of people in its struggle to regain its financial equilibrium, and that's not including all the high-level staff in the PR and inter-company departments that left after the initial purge in Rory Read's early tenure.
According to the financial announcement, AMD will reduce its workforce by 7%, which means around 710 jobs. It kind of puts into perspective just how few employees AMD has in the world compared to the likes of HP, Samsung and Intel itself.
AMD is playing a long-term game
Not that it has much choice at this point. Until it somehow manages to cut its dependence on laptops, it will continue to suffer losses instead of making profits.
