AMD posts sixth straight quarterly net loss
By Duncan Martell
SAN FRANCISCO (Reuters) - Advanced Micro Devices Inc <AMD.N> posted its sixth consecutive quarterly net loss on Thursday as the chip maker continued to lose market share to far larger rival Intel Corp <INTC.O>.
But AMD shares ticked higher in extended trading as the company said it expects second-quarter revenue to decrease in line with seasonal trends, reassuring investors who had feared a steeper decline.
"The stock is up due to a bit of relief that things weren't worse," said CRT Capital Group analyst Ashok Kumar.
The company is looking to a server chip code-named Barcelona to help reverse market share losses to Intel. The chip had been hampered by a flaw that has since been fixed.
AMD also, a year ago, promised to give details of an "asset-light" manufacturing strategy, which could include selling its chipmaking plants entirely or having a contract chipmaker like Taiwan Semiconductor Manufacturing Co Ltd <2330.TW> <TSM.N> make more of its chips.
AMD Chief Executive Hector Ruiz said on a conference call that while there no details to announce immediately, they would be coming in the next three months, or by the end of the year.
"We believe will also have an opportunity to further restructure the company for increased focus and added flexibility, which places us in a better position to deliver sustainable, profitable growth," Ruiz said, noting that he hopes to "communicate details in the near future."
AMD, based in Sunnyvale, California, said its first-quarter net loss narrowed to $358 million, or 59 cents a share, from $611.0 million, or $1.11 a share, a year ago. Revenue advanced 22 percent to $1.51 billion from $1.23 billion.
AMD's adjusted loss per share was 51 cents, compared with analysts' average expectation of a loss of 47 cents, according to Reuters Estimates. Revenue was pegged at $1.50 billion by Wall Street, after a warning from the company last week .
The poor results came even as Intel and other high-tech companies like International Business Machines Corp <IBM.N> have so far posted generally positive earnings.
AMD remains a generation behind Intel in its chipmaking technology, but if AMD can ramp up production of its Barcelona server chips their competitive price could help the company regain market share. But Intel's own next-generation chip, code-named Nehalem looms.
"They have no place to hide right now," Kumar said. "Desktops PCs are being commoditized, in notebooks the mix is