AMD reports Q1 loss on GlobalFoundries charge

AMD recorded a net loss of $590 million in the first quarter, thanks mostly to one-time manufacturing and acquisition charges

Advanced Micro Devices reported a first-quarter net loss Thursday as costs related to GlobalFoundries and its SeaMicro acquisition weighed on its earnings.

For the quarter ended March 31, AMD reported a net loss of US$590 million, a sharp drop from the $510 million profit it reported in the same quarter last year.

AMD had a charge of $703 million payable to GlobalFoundries, the manufacturing division it spun off, due to an amendment to a chip-supply agreement between the companies.

The new agreement allows AMD to work with other companies to source chips made with an advanced, 28-nanometer manufacturing process. But AMD will continue to work with GlobalFoundries on 32-nanometer parts.

AMD announced during the quarter that it would buy low-power server vendor SeaMicro for $334 million, to expand its presence in the burgeoning microserver business. The cash impact of the purchase was $281 million, AMD CFO Thomas Seifert said in a statement.

Excluding one-time items, AMD reported income of $92 million, or $0.12 per share. That was ahead of the estimate of $0.09 per share by financial analysts polled by Thomson Reuters.

Revenue was $1.59 billion, down from $1.61 billion in the first quarter of 2011.

AMD saw success during the quarter in the $400 to $700 mainstream laptop segment and also saw its chip supplies return to normal, said Rory Read, AMD's CEO, in a commentary. Chip sales had suffered because of a shortage in hard drives, which pulled down PC shipments.

AMD is poised for growth with new chips in the pipeline, Read said.

AMD is expected to launch new consumer PC chips this quarter code-named Trinity, which will take on Intel's upcoming Core processors code-named Ivy Bridge. AMD says it will push low-power variants of Trinity into lightweight laptops that it hopes will be cheaper than Intel-based ultrabooks.

AMD will also ship new low-power chips this quarter for netbooks, which should improve chip sales, Read said.

AMD has been restructuring its operations since appointing Read as its new CEO last August. Read has overhauled management and focused the company more on the server market while redefining its chip development strategy. The SeaMicro acquisition was a big step in its server strategy.

In February, AMD said it would start to integrate other companies' intellectual property in its processors, so it can offer purpose-built chips to customers. It said it would not rule out combining ARM-based designs with its x86 CPU and graphics chips.

Agam Shah covers PCs, tablets, servers, chips and semiconductors for IDG News Service. Follow Agam on Twitter at @agamsh. Agam's e-mail address is

Join the newsletter!


Sign up to gain exclusive access to email subscriptions, event invitations, competitions, giveaways, and much more.

Membership is free, and your security and privacy remain protected. View our privacy policy before signing up.

Error: Please check your email address.
Keep up with the latest tech news, reviews and previews by subscribing to the Good Gear Guide newsletter.

Agam Shah

IDG News Service
Show Comments


James Cook University - Master of Data Science Online Course

Learn more >




Back To Business Guide

Click for more ›

Most Popular Reviews

Latest Articles


PCW Evaluation Team

Christopher Low

Brother RJ-4230B

This small mobile printer is exactly what I need for invoicing and other jobs such as sending fellow tradesman details or step-by-step instructions that I can easily print off from my phone or the Web.

Aysha Strobbe

Microsoft Office 365/HP Spectre x360

Microsoft Office continues to make a student’s life that little bit easier by offering reliable, easy to use, time-saving functionality, while continuing to develop new features that further enhance what is already a formidable collection of applications

Michael Hargreaves

Microsoft Office 365/Dell XPS 15 2-in-1

I’d recommend a Dell XPS 15 2-in-1 and the new Windows 10 to anyone who needs to get serious work done (before you kick back on your couch with your favourite Netflix show.)

Maryellen Rose George

Brother PT-P750W

It’s useful for office tasks as well as pragmatic labelling of equipment and storage – just don’t get too excited and label everything in sight!

Cathy Giles

Brother MFC-L8900CDW

The Brother MFC-L8900CDW is an absolute stand out. I struggle to fault it.

Luke Hill


I need power and lots of it. As a Front End Web developer anything less just won’t cut it which is why the MSI GT75 is an outstanding laptop for me. It’s a sleek and futuristic looking, high quality, beast that has a touch of sci-fi flare about it.

Featured Content

Product Launch Showcase

Don’t have an account? Sign up here

Don't have an account? Sign up now

Forgot password?