AMD hosted their quarterly earnings conference call this afternoon to announce their financial results for the quarter ending June 2014. In a similar story to last quarter, AMD has inched closer to profitability yet again. Revenue for the quarter came in at $1.44 billion, an increase of 3% over Q1 2014 and up 24% year-over-year.
| AMD Q2 2014 Financial Results (GAAP in USD) | |||||
| Q2'2014 | Q1'2014 | Q2'2013 | |||
| Revenue | $1.44B | $1.40B | $1.16B | ||
| Operating Income | $63M | $49M | -$29M | ||
| Net Income | -$36M | -$20M | -$74M | ||
| Earnings per Share | -$0.05 | -$0.03 | -$0.10 | ||
Once again, gross margins were flat over the preceding quarter at 35%. Operating income for the quarter was $63 million, up from $49 million in Q1, however the GAAP results still ended up with a $36 million net loss. The Non-GAAP numbers come in higher due to the exclusion of $49 million in loss from debt redemption.
Non-GAAP operating income was $67 million, with a net income of $17 million or $0.02 per share which missed analyst’s expectations of $0.03 per share.
| AMD Q2 2014 Financial Results (Non-GAAP in USD) | |||||
| Q2'2014 | Q1'2014 | Q2'2013 | |||
| Revenue | $1.44B | $1.40B | $1.16B | ||
| Operating Income | $67M | $66M | -$20M | ||
| Net Income | $17M | $12M | -$65M | ||
| Earnings per Share | $0.02 | $0.02 | -$0.09 | ||
Cash, cash equivalents and marketable securities were $948 million at the end of the quarter. AMD has a target for cash on hand of $600 million minimum with $1 billion as an optimum target, and is within that window. Total debt went up from $2.14 billion to $2.21 billion.
Once again, the Computing Solutions segment of AMD performed poorly, with a revenue decrease of 1% from Q1, and 20% from Q2 2013. AMD attributes this to a decrease in microprocessor unit shipments. However higher margins and an increase average selling price (ASP) meant that the increased the operating income to $9 million for the quarter, up from the $3 million loss last quarter, and also up from the $2 million in income at the same time last year.
| AMD Q2 2014 Computing Solutions Division Financial Results | |||||
| Q2'2014 | Q1'2014 | Q2'2013 | |||
| Revenue | $669M | $663M | $841M | ||
| Operating Income | $9M | -$3M | $2M | ||
Graphics and Visual Solutions continued its strong performance from last quarter with an increase in revenue of 5% from last quarter, and 141% year-over-year. AMD once again attributes this gain to semi-custom SoC shipments which likely mean Game Console sales. GPU revenue was down both sequentially and year-over-year but slightly offset by an increase in professional graphics and desktop OEM GPUs. Overall operating income for the segment was $82 million, down from $91 million last quarter and up from a breakeven point in Q2 2013. GPU ASP decreased compared to both last quarter and Q2 of last year.
| AMD Q2 2014 Graphics and Visual Solutions Division Financial Results | |||||
| Q2'2014 | Q1'2014 | Q2'2013 | |||
| Revenue | $772M | $734M | $320M | ||
| Operating Income | $82M | $91M | $0M | ||
AMD has reorganized its reporting structure for upcoming financial results. As of Q3 2014, the segments will be Computing and Graphics which include desktop and notebook processors, chipsets, and GPUs, and Enterprise, Embedded, and Semi-Custom segment which will be servers, embedded systems, and game consoles.
AMD is expecting a 2% revenue increase plus or minus 3% for the 3rd quarter this year.
AMD still has some work to do in order to get to profitability, but so far 2014 has been a lot easier on them than the last couple of years.
Source: AMD
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pTmdfx - Friday, July 18, 2014 - link
The executives have already explained this in the earlier Earnings Call, that the non-recurring engineering expenses of the semi-custom chips *were paid* by the customers. So basically the margin of the semi-custom chips is likely nothing but just profit.jjj - Friday, July 18, 2014 - link
Last year the Graphics revenue was 320mil and that includes the old consoles ,so it's safe to say that GPU this quarter was under 300 mil.But it is sad that the CPU side is fading away like that. They need to target "console like performance"with their 20nm APUs (or 14nm if they end up skipping 20nm) as soon as possible and then get those new cores out fast.
silverblue - Friday, July 18, 2014 - link
I don't think the lack of availability of the A8-7600 has helped as it appears to be the one APU that people are looking to purchase. A more custom approach to their APUs could also help; they did say they would create chips based on a modular design with different combinations of compute units to suit requirements but I imagine this isn't very high on their list of priorities right now.Providing "console like performance" would be a difficult task; the CPU performance is there with Steamroller but even with "only" 512 cores, there's a lack of memory bandwidth. I'm not sure raising the number of cores to 768 would even get the APU to XBox One levels; the XBox One has a quad channel memory interface pushing 68GB/s which is practically double that of a dual-channel PC, so there's going to be diminishing returns for adding extra cores without the bandwidth to back them up, and that's without considering ESRAM or stacked memory.
Hrel - Friday, July 18, 2014 - link
so, what? Maybe 6 years till they start selling off business assets and go away entirely.vortmax2 - Friday, July 18, 2014 - link
You don't want them to go away entirely...that's a bad thing for competition, innovation and prices.HighTech4US - Friday, July 18, 2014 - link
Well if they do go away then Charlie and his annoying fanboi flock would also disappear. So that would be a plus.CiccioB - Monday, July 21, 2014 - link
You are supposing that without AMD things remain the same for Intel.But that mey not be true.
Demiurge - Friday, July 25, 2014 - link
What is the typical use case performance delta between Haswell and Ivy Bridge at the same frequency? Also, what is the frequency delta between the two, what is the performance delta there? I think Intel's last several years have shown what they think they need in terms of performance to sell CPU's. They've actually focused on other markets as a result too. Look at their restructuring...Gizmosis350k - Saturday, July 26, 2014 - link
Your post stinks of Intel's cock.nunya112 - Saturday, July 19, 2014 - link
As a share holder I can't be happy at all with this report! My shares have lost value for 2 years straight!