AMD Revenue Drops as CEO Search Continues
Advanced Micro Devices' revenue for the second fiscal quarter of 2011 sunk as the search for a new CEO continues, the company said on Thursday.
The company reported revenue of US$1.57 billion for the quarter ending July 2, declining by 5 percent compared to the second quarter in the previous year. The decline was in line with a 5 percent revenue drop expected by analysts polled by Thomson Reuters.
On a non-GAAP basis, AMD reported a net profit of $70 million, which was lower than the $83 million net profit reported in the year-ago quarter. Earnings per share was $0.09, while analysts estimated an EPS of $0.08 on a non-GAAP basis. Including charges related to GlobalFoundries assets, the company reported a net profit of $61 million on a GAAP basis, an improvement from a loss of $43 million a year ago.
The company's search for a CEO continues, and a status update will be provided on a conference call to discuss the second-quarter financial earnings, an AMD spokesman said. The call is scheduled for later on Thursday.
AMD has not found a CEO in more than six months after former chief Dirk Meyer resigned in January following disagreements with the board of directors on the direction of the company's mobile strategy. Thomas Seifert, the chief financial officer, took over as interim CEO after Meyer resigned.
AMD has been criticized for being slow to recognize the growth of tablets, and to date has not announced any radical change in strategy to quickly adapt to the fast-growing smartphone or tablet markets. It rushed to release its first dedicated tablet chip in June, and is continuing to release PC and server products as planned.
Many executives have already shied away from taking on the job of CEO, according to media reports. The list of candidates approached by AMD reportedly includes William Nuti, CEO of NCR Corp.; Pat Gelsinger, formerly Intel's chief technology officer and senior vice president and now EMC's chief operating officer; Apple's chief operating officer, Tim Cook; and Mark Hurd, who joined Oracle as co-president in September after being ousted as Hewlett-Packard's CEO.
Revenue from the computing solutions division, which deals in chips, was $1.2 billion, making it flat year over year. Revenue for the graphics segment was $367 million, declining from $440 million the previous year, partly due to a lower demand for discrete graphics cards.
AMD early this year started shipping Fusion chips, which combine a graphics processor and CPU on a single chip. Mainstream PCs based on AMD's latest Fusion chips code-named Llano started appearing in the second quarter at prices between $500 and $700. AMD later this year plans to release server chips based on the new Bulldozer microarchitecture.
AMD lost microprocessor-revenue market share to rival Intel during the calendar first quarter this year, according to IHS iSuppli. Intel's microprocessor revenue share was 82.6 percent, growing from 80.6 percent in last year's first quarter, while AMD's microprocessor-revenue market share fell to 10.1 percent, compared to 11.8 percent.
AMD said it expects revenue in the third quarter to increase by 10 percent, plus or minus 2 percent, compared to the second quarter.