Thursday, May 22, 2008

AMD is still in negative

Already the sixth consecutive quarter the company finishes with AMD unprofitable balance. Each quarter financial report marks the publication of the fact that AMD had to recognize the leadership of their errors in management and make statements about how the company is going to pick up from this grave situation. But the first quarter of 2008 ended with a relatively good result: the company was able to slightly reduce the size of financial losses, compared with five the previous reporting period.

According to a report recently promulgated for the first quarter of 2008, company revenues grew by 22%, to $ 1.51 billion in cash equivalent, in comparison with data report issued a year earlier ($ 1.23 billion). Net loss company at this time amounted to $ 358 million, down by 41%, compared with the same period last year, while operating losses amounted to $ 264 million I recall that in operating liabilities of $ 50 million, this loss, which became a consequence of the acquisition of ATI.

And even though some of the tendency to stabilize the financial situation, the company AMD profit for the first quarter of 2008 was lower than predicted by analysts from Wall Street.

In this regard, the company's Chief Financial Officer AMD Robert Rivet said that not enough high profits guilty seasonal factor, the overall economic crisis raging in the U.S. associated with the unfortunate crisis poor state of potential buyers, the low demand for the company's previous generation products, etc. .

In general, all around the blame, except the company AMD.

Experts and analysts with this view did not agree. In their view, can be arbitrarily long penyat to the crisis and bad weather, but why not look very good financial situation of companies in need of AMD.

At the state of affairs company AMD has adversely affected the transaction to acquire the developer ATI Technologies graphics solutions in 2006, as well as the untimely withdrawal of new products to market. A vivid example can serve as a situation where a fully working Quad processors AMD Opteron (with the architecture of Barcelona) have been issued only after 7 months after the start of the first deliveries. It punctures from the company, according to analysts, largely caused all the financial turmoil.

Despite official statements, leaders of the company, probably understands that it is time to take resolute measures to changes within AMD. CEO of AMD Hector Ruiz announced a series of tough action, which should help us get out of the unenviable position. The first step is to be held full-scale restructuring of the company, and promised aggressive policies to reduce production costs.

And do not deceived! Recently, the company AMD announcement as "aggressive policy to reduce production costs" announced staff reduction of 10% of the total mass of staff. The company also AMD meticulously analyze all secondary lines of business, will provide a number of priority, and with the rest, not bringing profits, farewell. Naturally, production x86 processor architecture and development of graphics chips are the priorities, and focus them on AMD.

If the calculations of internal AMD are correct, then finish with unprofitable accounts after all anti-crisis operations could be already in the second quarter of 2008. Third quarter will be the first profitable enough for the long term, and the situation finally stabilized. This time analysts forecasts of statements coincide with the company's management, and they also talk about the third quarter of 2008 as a turning period, one of the main reasons they call a new range of products that should make a decent competition "enemy" Intel Core 2 Duo.

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