AMD Reports Loss, Layoffs

AMD reported this week a net loss of $358 million, or $0.59 per share, and an operating loss of $264 million and announced plans Thursday to cut 420 jobs companywide, including 215 in Austin, Texas, its largest nonmanufacturing site. That facility will have a work force of about 2500 after the layoffs.

First quarter 2008 gross margin was 42 percent compared to 44 percent in the fourth quarter of 2007 and 28 percent in the first quarter of 2007. The decrease from the prior quarter was primarily due to decreased microprocessor unit shipments, AMD said in a statement.

AMD's chief financial officer, Robert Rivet, said the results reflect a weak first quarter "amplified by a challenging economic environment for consumers and lower-than-expected revenues of previous generation products, resulting in lower-than-expected revenues in all business segments." AMD officials said second-quarter sales are also expected to be "seasonally down."

The results include an impact of $50 million, or $0.08 per share, from ATI acquisition-related charges. First quarter revenue decreased 15 percent compared to the fourth quarter of 2007 and increased 22 percent compared to the first quarter of 2007. In the fourth quarter of 2007, AMD reported revenue of $1.770 billion, a net loss of $1.772 billion, and an operating loss of $1.678 billion. In the first quarter of 2007, AMD reported revenue of $1.233 billion, a net loss $611 million, and an operating loss of $504 million, the company said.

“We remain committed to achieve operating profitability in the second half of the year, driven by our portfolio of new products and platforms and aggressive restructuring programs,” Rivet said.

AMD has plans to build a $3.2 billion chip manufacturing plant in Saratoga County, in New York's Capital District. It has until July 2009 to commit to the project and still receive $1.2 billion in state incentives, the Albany Business Review reported today. (See also: NY NanoCenter Awarded $4M)

For more information, visit: amd.com