AMD reports Q2 results: $1.2B loss, quitting handheld and digital television businesses

Well, no wonder Hector Ruiz quit as the CEO of AMD earlier today -- the chipmaker just announced its second quarter results, and they're not good. In addition to an overall $269M operating loss, the company is taking an $876M charge against the purchase of ATI so it can abandon the handheld graphics and digital TV markets. To be honest, we hadn't been hearing much about ATI's plans in those areas, so it's probably for the best the company is focusing on getting Barcelona out the door after the launch of Puma -- but we doubt much is going to happen with a power vacuum at the top and a bottom line that's bleeding red.

[Via Crave]

[Charles Han @ Jul 17th 2008 8:11PM]

wow amd, well shit hitting the fan can also be a good catalyst for great change. I hope you shape up and conquer both intel and nvidia once again!

[JohnTitor @ Jul 17th 2008 10:40PM]

it sucks AMD is taking its losses on ATi, even though they didn't market or anounce much ATi has a huge lead in terms of quantity in handheld GPUs, TVs not so much but my HDTV does have a ATi Xilleon. I really don't see why they would quit Handhelds, hope they come back

[ishism @ Jul 18th 2008 1:57AM]

Well, with companies trying to make such ridiculous profits, for the cost of pennies, they better start to looking for the least developed country and start production there. Wages have been dropping in the U.S. for decades. Maybe they can bring production back to the U.S.
Free trade, ain't it grand?

[thedesolate1 @ Jul 18th 2008 1:32PM]

Well I dont blame them for quitting the moblie gpu market and all since certain companies *cough*HTC*cough* dont even bother writing frickin drivers for the chips!! Grrrrrrrrrrrrrrrrr. But I really hope they come back and bring in a hybrid cpu/gpu solution to compete with nvidia's TEGRA and intel. After all mobile is the future. Thats why companies are increasingly making their applications mobile and so are websites slowly shifting to have mobile versions.

[Huy @ Jul 17th 2008 8:13PM]

Well looks like AMD failed to take advantage of the whole mobile GPU disaster with Nvidia. Tis a shame...

[jaalin @ Jul 17th 2008 8:17PM]

they took care of it fine with the 4850 and 4870. we probably won't see the profits from those until next quarter

at least i hope so, cuz those drivers need work!

[loosely_coupled @ Jul 17th 2008 10:07PM]

?? What are you talking about? First of all, it was hardly a "disaster". Nvidia has a ton of money, and AMD doesn't yet have competent mobile GPUs.

Secondly, AMD has done an EXCELLENT JOB. The 48xx series launch is going to be a historical event in their company's history as a big turn around. However, since the release was within the last few weeks, you won't see any of the financial results for months.

On the CPU side, AMD has got to get their 45nm "Shanghai" variant of Barcelona out the door and get a mobile-version made!

[contact @ Jul 17th 2008 8:14PM]

enough with this 'second' thing ok. grow up

[someguy7234 @ Jul 17th 2008 8:15PM]

Loser? Double Loser

[L8on @ Jul 17th 2008 8:15PM]

lol @ the irony

[UFdlim @ Jul 17th 2008 8:15PM]

Well shit, I really like the current Intel offerings with C2D, but I bought a Puma laptop (tx2500) anyways. Without healthy competition we'll just be stuck with another generation of bad Intel chips like the P4.

[Johno @ Jul 17th 2008 8:20PM]

So does that mean we will not be seeing further development of this?

http://www.engadget.com/2008/06/11/amd-achieves-open-gl-es-2-0-compliance-brings-xbox-360-graphics/

It would be a terrible waste I fear

[phanbouy @ Jul 17th 2008 8:21PM]

wow this first shit's really getting out of hand lately

[Xen Wildman @ Jul 17th 2008 9:20PM]

Time for Nvidia or someone to buy out all their IP. NV could do with some HyperTransport lovin.

[Chris @ Jul 17th 2008 8:39PM]

I didn't even know AMD was in the tv business (unless their getting rid of their tv wonder cards and that would suck!)

[Saad Rabia @ Jul 17th 2008 8:40PM]

Guys, can anyone link me with a good site explaining what exactly is going on? and why is AMD having all these crises all at once? Does this huge lose mean that the company is going to die or that Microsoft is buying it?

[wslcrew @ Jul 17th 2008 10:56PM]

It's simple: their product isn't as good as their competetor's (Intel)

In the early 2000s, AMD gained large marketshare from Intel with their high performance chips. With higher revenue, they should have invested more on R&D and come up with new products. Instead, they spent that money on buying other companies that wasn't related to their core business. These acquisitions brought new problems to the management (dealing with shareholders, taking care of new employees, etc.), which ultimately made them less focused on their core business. Intel, meanwhile, was developing new products with better performance and it resulted in regaining the market share once lost to AMD.

Ultimately, AMD will never die off. Intel won't let that happen to avoid antitrust regulations. But unless they do something, their business will shrink down even further.

[servognome @ Jul 17th 2008 11:49PM]

Intel spends as much on R&D as AMD makes as a company. AMD is behind in the fab R&D, not in the product space. They have superior designs they just can't match performance because they are behind in the capital intensive manufacturing space.
The purchase of ATI allows them greater revenue so they can afford more R&D; gives them motherboards and video so they can compete with platform products ala Centrino; and lets them do more types of R&D with GPU/CPU combinations (look at how nVidia is starting to compete with Intel)
It isn't about products since they have first x86 SOC, first 64-bit, first dual core, etc. It's about a fundamental lack of capital to invest in fab technology. The fix isn't some easy answer like "spend more on R&D"

[icepop4who @ Jul 17th 2008 8:41PM]

Ouch. Although this isn't unexpected. I'm seeing less and less AMD processors prebuild pcs. ATI was getting its red ass kicked until recently it showed some hope. But seriously, AMD is really falling in the face down.

[digitallysick @ Jul 17th 2008 8:41PM]

Dear amd, intel keeps releasing better chips, want to beat them? by now intel probably has 6 and 8 core chips ready, amd you will need to maybe 10 to 12 cores, dump all of your money into that. Also see if you can do better than 45 nano meter on your chips, = win

[Saad Rabia @ Jul 17th 2008 8:42PM]

Moderators, please answer our reports. Is it really that hard to delete these posts?

[Ignatius @ Jul 17th 2008 8:45PM]

That and they're celebrating about being the top of the speedy retard class.
Daaamn.

[maty @ Jul 17th 2008 8:48PM]

"7 TH !!!!"...

7th lowest rank, I fear.

Back on-topic, grave news =[.

[maty @ Jul 17th 2008 8:57PM]

Wow.

Someone has issues.

I really can't be bothered to list all the flaws in that pitiful argument. You've made false assumptions and shot yourself in the foot on several occasions.

Your name and your continual resorting to the caps lock key also suggest that you lack the intellect to fully structure your arguments.

You have to 'pee' all over your argument to make it stand up. Point, evidence, explanation. Didn't they teach you that?

Now, back to discussing this news.

I guess its a good thing AMD is cutting its losses and pulling out, they really need to sharpen up their focus and products, however. ATI still has selling power as a brand, but AMD has a reputation to re-establish.

[sinai @ Jul 17th 2008 9:00PM]

one day, i will invent a machine through which i can punch people in the nuts via the internet.

[Justin @ Jul 17th 2008 9:02PM]

I know one thing--if things don't get better for AMD soon, we all lose.

Every single goddamn one of us.

Even you Nvidia fanboys.

[Christian Walters @ Jul 17th 2008 9:07PM]

whats bad, and massivley ironic at the same time about this douchbag here(blurayisdead), is that he called the HD format wars outcome wrong, judging by his name...and now hes pre-emtivley calling the processor wars....wanna take a shot at Palm and the iPhone while your at it?

[phanbouy @ Jul 17th 2008 9:15PM]

BluRayisDead is dead

[Minilap @ Jul 17th 2008 9:43PM]

This is a really sad news.

[bartoron @ Jul 17th 2008 9:46PM]

I actually bought an Athlon 64 4000+ a few days ago. I just put it in today. If only socket 939 wasn't pretty much extinct. :(

[RevisionZero @ Jul 17th 2008 9:59PM]

To everyone who is complaining about AMD not being able to put out competetive products, lets use some common sense please.

AMD has a much smaller amount of R&D money, Im surprised they are even able to compete on any level with Intel. For what they have there putting out awesome products, and with ATI now moving into the lead in the graphics devision, AMD still has hope, there banking alot and have been, on there Fusion Chip. Which, one can hope with ATI's (there recent success in the 4000 line is great news for the fusion chip, means there chip engineer's know what there doing) help its going to do much better than Intel's Counter to that.

I really wish AMD could get a boost from someone, kinda like Apple back in its trouble days.

[Christian Walters @ Jul 17th 2008 10:42PM]

"I really wish AMD could get a boost from someone, kinda like Apple back in its trouble days."-

What? Ohh, the Apple fanboys are gonna crap when they read that!

[Luigi193 @ Jul 18th 2008 12:09AM]

Why would Apple fans get mad?

[retro77 @ Jul 17th 2008 11:04PM]

Ouch....well they do have the weight of ATI on them. Hopefully with the new cards that slightly outperformed Nvidia, that weight will be a little lighter.

[Abuzar Baloach @ Jul 17th 2008 11:32PM]

Yeah, I think ATI will be the division making profit this time around, while AMD bleeds money.

[Carl Vitullo @ Jul 17th 2008 11:14PM]

Man, this joke just gets funnier and funnier.

[Steffen Jobbs @ Jul 17th 2008 11:16PM]

Good job. I'd like to see how many can post in order. See if you can get first, second, third, fourth and fifth. I'll bet that would be difficult. That stuff seems like a lot of fun to do with these boring articles.

AMD is getting out of businesses I didn't even know they were in. Maybe they'd better stick to CPUs, but with Intel around, they don't stand a chance.

[Carl Vitullo @ Jul 17th 2008 11:16PM]

Good one phanboy. /sarcasm
that was actually a well structured argument, and it makes a lot of sense. Go troll somewhere else.

[Abuzar Baloach @ Jul 17th 2008 11:26PM]

You DO know that the ATI 4870X2 is cheaper and out performs your GTX 280 right?

[Sean O @ Jul 17th 2008 11:28PM]

I wonder how many millions that CEO took with him.

[Rahul @ Jul 18th 2008 12:22AM]

If I were thinking about building a new rig, now is the time. AMD is dead, its over, they are finished, they are just a smoldering and flaming boat that is breaking apart piece by piece.

Buy your AMD chips and Intel chips before the monopoly of Intel begins.

Avoid HP laptops with AMD chipsets, they over heat! (My own opinion and experience on the tz2500 tablet and a dv6 series.)

Intel will not be backing down anytime soon and AMD is going nowhere fast.

Some foreign company will buy AMD and rip it apart to service cheap platforms like Chinese knock off phones and crappy crippled laptops.

(See VIA for example)

This is just my speculation and opinion. I believe that this is a shape of things to come.

[Abuzar Baloach @ Jul 18th 2008 1:00AM]

Well Intel is still pushing out great chips(Nehalem) even though there is barely any competition from AMD.

[melvz @ Jul 18th 2008 12:22AM]

yah!! good news!! AMD still manages to shot itself on the foot!!!!

[wisefool @ Jul 18th 2008 3:25AM]

If AMD falls, you guys have only yourselves to blame. Sometimes the best chip is not necessarily the "good" chip.

[Logboy @ Jul 18th 2008 4:26AM]

Wow didn't even know they were in the handheld and digital TV business Maybe that was the problem.

[peach @ Jul 18th 2008 12:11PM]

Well unless you're a buyer of components for handheld devices or DTVs you're not likely to be aware of their activities. Those parts of the business are very b to b and with only 10 main customers in each of the areas it's not like they need to do broad consumer-targeted marketing activities, or even broad industry-targeted marketing activities, they're likely engaged in very 1:1 type activties.

[automagnus @ Jul 18th 2008 11:07AM]

1.2 billion in losses is not actually lost money. If you bother to read the earnings report then you will realize that $920 million of that is due to devaluing of it's handheld and DTV divisions. They already paid for ATI so it is money they already spent. All they are saying is that those divisions are worth 920 millions less than they believed they were worth when they bought. This $920 millions was already spent last year when they bought ATI.

So it's like buying $100 in stock 12 months ago and say for example the stock losses $50 of it's value yesterday. It's not like you are spending another $50 it's just a $50 loss in assets.

The actual amount of cash lost by AMD is more in the range of $200 to $300 million (go do the math yourself) which is not so bad.