Advanced Micro Devices Inc chief operating officer and chief technical officer Atiq Raza resigned unexpectedly yesterday, as the company posted a loss of $162m, or $1.10 per share, excluding a one time after tax gain of $259m from the sale of Vantis Corp. Including the one time gain, AMD reported net income of $79.9m. Last year in the same period the company lost $64.6m. Revenue rose 13% to $595.1m, up from $526.5m a year ago.
Unconvincingly, Raza claimed personal reasons for the resignation and said it was not related to the financial problems. The loss was, however, less than the revised $1.26 loss analysts had been predicting since AMD’s profit warning in June (CI No 3,689).
Unit sales of K6 microprocessors during the quarter fell to 3.7 million from 5 million in the first quarter, and the average selling price fell to $67 down from $78 in the first quarter. AMD has now fixed its supply problems, and was able to churn out around 6 million chips, over half running at clock speeds of over 400MHz. But customers defected to Intel Corp after they couldn’t get hold of supplies during the first quarter. Problems were intensified by National Semiconductor Corp’s exit from the x86 market, which resulted in a sell off of cheap inventory onto the market, AMD said. Like Intel, AMD reported strong sales of flash memory products used for cellular phones.
AMD is now pinning its hopes on the forthcoming K7 Athlon processor, which has already begun initial shipments. Chairman Jerry Sanders said he now expected that 1 million Athlon chips could be produced in the fourth quarter. á
