For the fourth quarter, revenue will decrease 9 percent
sequentially, plus or minus 4 percent, with flat operating expenses,
the company said.
Among the highlights from AMD's results were:
- Gross margin (31 percent) decreased sequentially due to an
inventory write-down of approximately $100 million primarily
consisting of first generation A-Series Accelerated Processor
Units (APUs) (“Llano”), weaker-than-expected demand.
- Computing Solutions segment sales dropped 11 percent
sequentially and 28 percent year-over-year.
- Graphics segment revenue decreased 7 percent sequentially and
15 percent year-over-year. Graphics processor unit (GPU) revenue
decreased 14 percent sequentially due to lower unit shipments to
OEMs partially offset by higher channel sales.
APU sales jumped 70 percent in the third quarter,
and constituted a third of notebook shipments for the
- AMD is getting first silicon back on its Kabini
SoC and represents the company's "first true SoC
design." The device is "on track" to launch in the first half of
- AMD expects the embedded market to constitute 20 percent of
its quarterly sales by Q4 2013, up from 5 percent today.
"They're in a tough spot right now," said Patrick Moorehead,
president and principal analyst with Insights & Strategy (Austin,
Texas). "It's the economy which is hurting them the most, and the
percentage of sales they get from consumer is dramatically higher
than that of Intel."
Acknowledging that the PC segment will be weak for at least several
more quarters, Read sketched out a push into embedded areas that
will leverage IP and emerging processor technology to quadruple the
percentage of AMD sales from the embedded market in the coming year.
"Our low-power APUs, graphics IP and reusable design blocks give us
a distinct advantage to build semi-custom APUs for new embedded
markets," Read said. He said AMD would target embedded markets such
as communications, industrial and gaming in this push. This "will
outpace the PC growth for the foreseeable future," he added.
Read said AMD APUs have a "number of confidential, high-volume
wins," but he refused to discuss specifics.
Lisa Su, senior vice president and general manager, global business
units, added, "The key differentiator we have is really in the
high-performance design methodology, microprocessor technology as
well as the graphics IP that we have."
When pressed Su declined to
name potential competition for AMD in the embedded sector.