SAN FRANCISCO—Advanced Micro Devices Inc. (AMD) Thursday (July 21) reported second quarter sales that fell short of analysts' expectations despite record microprocessor shipments in the quarter. Amid speculation that the company would also appoint a new CEO Thursday, AMD said the search for a new top executive remains ongoing.
AMD (Sunnyvale, Calif.) reported revenue for the second quarter of $1.57 billion, down 2 percent from the previous quarter and down 5 percent from the second quarter of 2010.
The company posted a net income in accordance with generally accepted accounting principles (GAAP) for the quarter of $61 million, or 8 cents per share, compared to a net income of $510 million in the previous quarter and a net loss of $43 million in the year ago quarter.
AMD's sales for the quarter fell short of consensus analysts' expectations, which called for revenue for the period of $1.58 billion, according to Yahoo Finance. The company's non-GAAP net income of 9 cents per share exceeded consensus analysts' estimates of 8 cents per share, according to Yahoo Finance.
Some had speculated that AMD might also Thursday announce its next CEO. The position has been vacant since Dirk Meyer abruptly resigned in January.
Harry Wolin, AMD senior vice president and general counsel, said the search for a new CEO remains a top priority and that AMD's board is pleased with the quality of the candidates it has interviewed. But Wolin said meeting a timeline is not the driving force for the CEO search—finding the right person is. "The board is pleased that the senior management team has executed well throughout this timeframe," Wolin said.
On Wednesday, Intel Corp., AMD's much larger rival in the microprocessor market, posted its fifth consecutive quarter of record sales, thanks in part to new revenue from recent acquisitions.
Shipments of Fusion accelerated processing units (APUs) drove record microprocessor unit shipments and record mobile microprocessor unit shipments for AMD in the second quarter, the company said. AMD's gross margin for the quarter was 46 percent, the company said.
AMD said computing solutions segment revenue was flat sequentially and year-over-year. Sequentially, higher mobile microprocessor revenues were offset by lower desktop and server revenue, the company said. The year-over-year decrease was primarily driven by lower server revenue, the company said.
Graphics segment revenue decreased 11 percent sequentially and 17 percent year-over-year, AMD said. The sequential decrease was driven primarily by lower discrete mobile unit shipments and seasonality in the desktop discrete graphics add-in board market, the company said, while the annual decrease was primarily driven by lower unit shipments.
"Today's computing experience is increasingly being defined by the ability to deliver brilliant multimedia and video content with all day battery life," said Thomas Seifert, AMD's chief financial officer and interim CEO, in a statement. "Fusion APUs are ideal to meet this need, positioning AMD to gain unit market share in the mobile computing space."
For the current quarter, AMD said it expects revenue to increase sequentially by 8 to 12, percent, reaching between $1.7 billion and $1.76 billion. Seifert said AMD expects gross margins to increase by 1 percent to 47 percent in the current quarter.