AMD Loses another $Billion in Q2'08 while Hector gets the boot

Bogged down by biased press and unfair benchmarks, AMD today reported second quarter 2008 revenue from continuing operations of $1.349 billion, a seven percent decrease (-7%)compared to the first quarter of 2008 and a three percent (3%) increase compared to the second quarter of 2007. As part of its previously communicated review of its non-core businesses, AMD decided to divest its Handheld and DTV product businesses, and therefore is classifying them as discontinued operations 1 for financial reporting.

In the second quarter of 2008, AMD reported a net loss of $1.189 billion, or $1.96 per share. For continuing operations, the second quarter loss was $269 million, or $0.44 per share, and the operating loss was $143 million. The results for continuing operations include a net favorable impact of $97 million, or $0.16 per share as described in the table below. Loss from discontinued operations was $920 million, or $1.52 a share, including asset impairment charges of $876 million, or $1.44 a share.

It may appear that AMD has mastered announcing earnings report in the midst of deflated expectations. Surprisingly, nobody seemed to care that AMD lost $270 million in the quarter and wrote off another Billion from its books. That's the AMD we're all familiar with, beating expectations the wrong way round.

But let's focus on the good news! No, Hector leaving can either be good new or bad news depending on which side of the fence you're sitting. His announcement in the midst of the report may have caught a lot of people by surprise, but like he said, it's been planned and talked about before. The real good news for AMD is that their new product line-up are gaining momentum. They never said which direction but still we're assuming it's getting design wins and a bunch of orders. AMD is also confirming together with Intel that the PC market is healthy. In fact it is so healthy that AMD just might lose a lot less in the 3rd quarter and probably break even in the 4th. AMD's promises might not worth much these days but this time the numbers do support it.

As for "SmartAss-et"(c), AMD didn't come out with any announcement but instead gave away a few more clues in the form of an easy riddle. They said, investment in the microprocessor business involves 3 things: process development, factories and chip design. And they said that, implementing smart-asset will take away two of those things. It doesn't take a genius to figure out that the two are investment in process development and factories. If AMD gets the deal then that would leave them to only focus on chip design . It does confirm that AMD is planning to go fabless. We've been discussing this several months ago while at the same time the blogger across the street thought that asset-smart was some kind of process improvement.