Today AMD released their Q1 FY 2015 financial results, and the company reported revenue of $1.03 billion for the quarter. This is a 16.9% decrease as compared to Q4 2014, and a 26.4% decrease from the $1.40 billion recorded in Q1 2014. Operating income based on GAAP numbers was an operating loss of $137 million, which is a substantial decrease in loss as compared to Q4 2014, where they had an operating loss of $330 million, however in Q1 2014 they had a small operating income of $49 million, so although they have improved quarter-over-quarter, that is a significant reduction year-over-year. Net loss for the quarter was $180 million, or $0.23 per share, which once again is better than Q4 2014 where there was a $364 million ($0.47/share) loss, but much worse than the $20 million ($0.03/share) loss in Q1 2014.

AMD Q1 2015 Financial Results (GAAP)
  Q1'2015 Q4'2014 Q1'2014
Revenue $1.03B $1.24B $1.40B
Gross Margin 32% 29% 35%
Operating Income -$137M -$330M $49M
Net Income -$180M -$364M -$20M
Earnings Per Share -$0.23 -$0.47 -$0.03M

Part of these losses are due to the ongoing restructuring at AMD, which has contributed heavily to these numbers. One of the new restructuring fees is due to the exit from the Seamicro branded dense server business, which has cost them an additional $75 million this quarter, including $7 million in cash. Due to these hits, AMD also provides Non-GAAP results which exclude these numbers. On a Non-GAAP basis, AMD’s operating loss is just $30 million, however that is still down significantly from the $89 million operating income in Q1 2014, and the $52 million operating income from last quarter. Net loss on a Non-GAAP basis is $73 million, or $0.09 per share. This is a decline from Q4 2014 where there was a net income of $18 million ($0.02/share) and Q1 2014 where they were able to achieve a net income of $35 million ($0.05/share).

AMD Q1 2015 Financial Results (Non-GAAP)
  Q1'2015 Q4'2014 Q1'2014
Revenue $1.03B $1.24B $1.40B
Gross Margin 32% 34% 35%
Operating Income -$30M $52M $89M
Net Income -$73M $18M $35M
Earnings Per Share -$0.09 $0.02 $0.05M

AMD has also entered into a fifth amendment of their agreement with GlobalFoundries, and AMD is expecting to purchase about $1 billion in wafers in 2015.

Breaking down their product segments, the Computing and Graphics segment had a 20% decline in revenue quarter-over-quarter, and a 38% decrease year-over-year, with Q1 having net revenues of $532 million. The quarterly decrease was due to lower desktop and notebook processor sales, whereas the yearly decrease was due to lower desktop processor sales and GPU channel sales. The division had an operating loss of $75 million for the quarter, which is a significant change from the $56 million loss last quarter and the $3 million income in Q1 2014. The loss was partially offset by lower operating expenses, but clearly more work is needed. AMD is hoping for better success with their new APU, Carrizo, which they are expecting to deliver double digit performance increases and much better energy efficiency compared to Kaveri, which is the current APU.

AMD Q1 2015 Computing and Graphics
  Q1'2015 Q4'2014 Q1'2014
Revenue $532M $662M $861M
Operating Income -$75M -$56M $3M

The Enterprise, Embedded and Semi-Custom segment had a year-over-year revenue decrease of 7%, and a quarter-over-quarter decrease of 14%, with Q1 2015 coming in at $498 million. The quarterly drop is due to a seasonal decrease in semi-custom SoC sales (read: Consoles had a ramp up for the holidays and are now back to lower sales) and the yearly decrease is due to lower numbers of server processors being sold. However this segment did have an operating income to report of $45 million for the quarter, but this is down from the $109 million in Q4 2014 and $85 million in Q1 2014.

AMD Q1 2015 Enterprise, Embedded and Semi-Custom
  Q1'2015 Q4'2014 Q1'2014
Revenue $498M $577M $536M
Operating Income $45M $109M $85M

The “All Other” segment had an operating loss of $107 million. As compared to Q1 2014, this is $68 million more operating loss, which is primarily due to the $75 million hit for exiting the dense server business. In Q4 2014 this segment had a $383 million loss.

For Q2, AMD is forecasting revenue being down an additional 3%, plus or minus 3%, and non-GAAP Gross Margin to remain flat at 32%.

AMD is certainly not in a great position right now, and the new CEO Dr. Lisa Su has some work to do in order to get AMD back to a financially viable state. Part of that is diversifying revenues, especially with the PC market slowing again. AMD has not had a significant product launch in a few quarters, which has not helped either.

Source: AMD Investor Relations

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  • chizow - Friday, April 17, 2015 - link

    Exactly, people keep stating the same nonsense when in reality, Intel and Nvidia still need to compete against themselves.

    Simply put, if you never spent more than $300 of your own money for a CPU or GPU, this WILL NOT CHANGE if AMD goes the way of the dodo.

    And if Intel/Nvidia start trying to charge more, people will start looking into cheap ARM-based alternatives (already happening).
  • Crunchy005 - Friday, April 17, 2015 - link

    Right now against AMDs current architecture Intel pricing is pretty good and their performance. But the black editions were running around $300 for top end AMDs around the Core 2 time and I remember Core 2 extremes being $1000, I would hate to see where top end intel prices go when they are the only x86-64 game out there.

    Also yes they do have a limit in how high they can go on pricing before people just leave, and Intel doesn't compete well against ARM, Atom, LOL. Love the i cores but those atoms suck(given away for free for a reason). The biggest problem is where power is needed ARM isn't there yet and it will suck for consumers in the short run but if people move more towards ARM prices will probably come back down. Just worried that Intel and Nvidia being to greedy to care. Monopolies are a thing people.
  • chizow - Friday, April 17, 2015 - link

    No...AMD was charging $450+ for their entry-level Athlon 64 chips and almost $1000 for their high-end FX chips before they got Conroe'd, only after did they start dropping prices into that $300 range.

    Certainly the Intel EE were out there but they never made much sense since they were just 1 or 2 multipliers away from the next lowest SKU which was priced reasonably in that $280-300 range.

    The problem Intel (and Nvidia) would face is what we have already seen. People are relying less and less on big powerful machines for most of their computing needs, so Intel and Nvidia are going to be competing against themselves to get you to upgrade that last 1 or 2 powerful PCs you may maintain.

    If they want $500, $800, $1000 for a 20% increase, you simply have the option to say "No thanks, I'll stick to what I have" which is basically what everyone has been doing in the CPU market anyways for the last 8 years. See: Comment section of any Intel CPU review since 1st gen Core i7 Nehalem.
  • Nagorak - Saturday, April 18, 2015 - link

    Why would you begrudge AMD charging for premium products? AMD has never been super profitable, and the anticompetitive practices from Intel when they had the performance crown meant they didn't benefit as much as they should have. It's probably part of the reason AMD is in the position they are today. It's not really about either company being saints, it's about the overall competitive landscape that harms all of us consumers.

    Maybe with the way things are going with PCs/x86 and Intel being so much stronger there is only room for one company. Maybe that is the reality of the future. But it's still basically unfortunate for all of us that there isn't more competition in the PC processor space. Intel is basically resting on their laurels now, resulting in next to no improvements in processor speed in 3-4 years. If you have a Sandy Bridge then you're still basically fine after all this time.

    Sure we've long since passed the point of "good enough" but Intel nor AMD is really pushing the performance envelope to give us a reason to upgrade, albeit for different reasons.
  • chizow - Saturday, April 18, 2015 - link

    I explained it elsewhere, AMD provided numerous reasonably priced, outstanding performance parts at very competitive price points relative to Intel, even if they didn't beat them outright, they were close enough to provide a great alternative.

    As soon as they got the commanding lead against Intel with Athlon 64/FX parts, they simply priced out this entire segment of users. If you were an AMD Socket A user, you simply had no option for an upgrade at your existing spending levels, AMD wanted 2-4x more and that's not even counting new, expensive mobo and RAM requirements. If anything, strong competition in this case led to worst pricing for the consumer.

    People keep wanting to blame Intel's anti-competitive practices for AMD not making a bigger market penetration with Athlon 64 but the reality of it was AMD couldn't get out of their own way. Supply shortages were the biggest problem, but the second biggest problem was they simply priced out the overwhelming majority of the market!

    Like I said, they made it VERY easy for me to switch to Intel for the first time in some 6-7 years when Intel released the Core 2 Duo and I was able to pick up an E6600 on Newegg for $283.

    Also, while it is true Intel is not necessarily pushing the core or IPC envelope anymore, they are still pushing in 2 key areas they consider their biggest threats/deficits relative to the rest of the market: iGPU and TDP. Still, despite what many consider lackluster gains they still provide me with a clear upgrade path and worthy upgrade every 2-3 years at the same price points I've always bought CPUs.

    This simply will not change even if AMD goes the way of the dodo, I simply won't pay more than ~$300 for a CPU, if Intel wants more than that I'll stick to what I have or find alternatives.
  • ppi - Friday, April 17, 2015 - link

    Well, right, but only to an extent.

    For example, without the first Athlon, Intel would have PIII clocked at 700 Mhz at the time of P4 release - and then the 1.4 GHz would have looked good. But Athlon forced them to go all the way up to 1 GHz with PIII, and all of sudden the initially released P4 was not such a hit.
  • silverblue - Saturday, April 18, 2015 - link

    The P4 was an emergency release because the Athlon was starting to take the performance lead. Like Bulldozer, it needed higher clocks, but the power situation was dire. Being the market leader gives you some wriggle room, however - SSE2 and SSE3 allowed developers to push the P4 to new heights before AMD put such support into their CPUs.
  • Impulses - Saturday, April 18, 2015 - link

    Intel has clearly eased off the performance pedal since AMD stopped being competitive tho... You can argue it was bound to happen with the mobile sector driving sales anyway and efficiency becoming paramount yadda yadda... But there's no question that if AMD had something that could rival any i Core part over the last few years Intel would've had to respond.

    So a CPU world where AMD is borderline irrelevant hasn't been as bad as many would've predicted in 2000... Hasn't been perfect either and Intel had outside forces to worry about. NV's got distractions instead of outside forces, they're not gonna make better GPUs worrying about ARM or HC. Intel made more efficient parts, NV would just go mess with something else... Hopefully not, but I don't see what keeps them on pace with desktop GPUs, certainly not devs.
  • FlushedBubblyJock - Saturday, April 25, 2015 - link

    That's a bunch of CRAP.HE

    Intel has some 14nm finfet or something, the bleeding edge they taped out, and last time I looked I saw some 16 core INTEL MONSTER WITH HYPERTHREADING AND 32 MEGS OF L3 CACHE !

    It's all in your amd fanboy head, and it's all wrong.

    intel pre sandy - sandy bridge massive increase , ivy bridge another 5-15%, haswell add another 5-15%, broadwell I don't even know....

    Intel has been forging AHEAD for 4 entire generations since it passed up AMD's cpu's.

    You're either insane or so used to lying to yourself so much that you'd believe anything you told yourself at this point, so long as it +'s amd or attacks amd's competitors or preferably both, and it certainly must be untrue, or you won't like it.
  • Impulses - Saturday, April 18, 2015 - link

    Ehh... GPU prices might go up, probably, and NV would likely slow down and/or focus on other markets (mobile and high end compute) if they have little competition. So yeah, we're probably screwed to a degree as gamers... The 970 would've surely been a $400+ part if there was no R9.

    On the x86 side, AMD hasn't been putting any tangible pressure on Intel for years. Not at the high end, and certainly not on mobile. They might have a niche with APUs on, but it's small... Intel's had bigger worries than AMD anyway, the enthusiast and high end market might've suffered some...

    But it hasn't been as bad as we might've guessed during the heyday of Athlon and scorching P4s.

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