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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  • WaltC - Saturday, April 18, 2015 - link

    Microsoft really threw a whammy into the PC OEM markets with Windows 8. The market is still trying to recover from that fiasco. But Intel is bullish on the PC sector, and so am I. I think things will turn around for the PC sector in general when Microsoft at long last finally ships Win10--as it seems clear that fewer people are interested in purchasing new PCs with Win8.1 on board just to have to install Win10 a bit later in the year. (In perspective, when we say "PC slump" we're still talking better than 30M PCs sold by the OEMs every *month* in a *bad* quarter--which is more in a month than xBone and PS4 combined have sold since they started shipping.) It doesn't bother me, of course, and it won't bother the people like me who don't buy OEM PCs but always build their own boxes--which I've done since 1995 (Gartner/IDC don't count those 20M-40M PCs a year.)

    It's fairly clear to me what happened at AMD. They scurried to jump on the ARM bus when they should have concentrated on x86 and competing with Intel instead of trying to go around them. AMD still sells greatly superior IGPs, sells great graphics cards, but the company has simply let its x86 cpu R&D languish and grow stale--and that's just beginning to hurt them in a big way. AMD needs to do some serious cpu work and get right in there head to head and compete with Intel on the cpu side of things--AMD leapfrogged Intel once for a couple of years...if they did it once, they can do it again. But they sure as heck won't do anything if they don't try. The ARM market and the low-cost mobile sector are obviously not enough to keep the company going. AMD is way ahead of Intel on the GPU side of things--so it's clear as to where they need to be to return to profitability. The sad thing is I don't see any signs from the company that it recognizes where it needs to be. AMD it seems has forgotten on which side its bread is buttered.
  • meacupla - Saturday, April 18, 2015 - link

    Strong IGP has become largely irrelevant for the people it was aimed at.
    Now, you no longer need to use a weak GPU due to size constraints. Just stream a feed, which can be video and games, from a more powerful computer somewhere else in the house. The only thing the end computer needs is a video decoder. Heck, it doesn't even need to be an x86 based PC, semi modern ARM devices can also decode video streams no problem.

    Now, if you need a portable gaming PC, then it's most likely going to be a gaming laptop with dedicated nvidia graphics or an mITX computer with dedicated GPU. Either way, the tendency is for nvidia, thanks to higher efficiency and lower power consumption.
  • medi03 - Sunday, April 19, 2015 - link

    Storng IGP is meant for mobile market, and it's more than relevant there.
    Except that nobody is pairing AMD CPUs with good screens.
    i3 or i5 have faster single core performance, but show two times lower FPS at games? What gives?
  • meacupla - Monday, April 20, 2015 - link

    I don't think the issue with AMD IGP is being paired with a good screen, rather, it's the power consumption and heat output of those A series APUs.

    Yes, Intel HD4x00 and 5x00 graphics are inadequate at games at practically all resolutions, but they run videos and streams just fine at 1080p. AMD A10 graphics are inadequate at 1080p, and you'd even want a 960m or 970m for some decent graphics.

    And let's not forget that the market is heading towards higher energy efficiency and thinner/smaller form factors... AMD A series chips are just out of the question.

    Like, what current AMD chip could you cram into, say, a 2012 macbook air 13" and net similar battery life and performance?
  • Yorgos - Wednesday, April 22, 2015 - link

    "Earnings Per Share -$0.09 $0.02 $0.05M"
    so in 2014Q1 the shares jumped from ~3$ to 50.003$
  • SeanJ76 - Friday, April 24, 2015 - link

  • LittleLeo - Friday, April 24, 2015 - link

    I don't see people lining up for days to buy the 1st AMD product.
  • FlushedBubblyJock - Saturday, April 25, 2015 - link

    I guess AMD really is tanking since the gigantic AMD red logo paying anandtech has been long gone for a while.

    The massive fanboy dollar pumping amd machine is dead.

    Do the amd fanboy infiltrators still get free hardware on the sly ? Who knows ?
    If they drop their secret raging fanboy fanatic shuffle, they're dead for sure.
  • HungryTurkey - Monday, April 27, 2015 - link

    It seems like every quarter, they post some gargantuan loss. I don't see how they stay in business, but I pray to the Sun Gods daily that they remain somewhat relevant. Lack of competition will make Intel sloppy and lead to the i7 equivalent of Willamette (you know you all miss that PIV 1.4 Ghz that could cook eggs, used expensive Rambus DRAM, and still performed worse than a lower clocked, cheaper Athlon). With AMD's IP shortfall compared to Intel, they really need to make some key moves not in marketing, but in bringing in some paradigm shifting-silicon designers. They've had some nice advances in the low-end segment, but they have to find a way to compete with Intel at the mainstream level (and do so without spending money they don't have). That's a tough order and short of a merger/acquisition with/by another entity that could fund insane levels of R&D, I can't see it happening.
  • dragonsqrrl - Monday, April 27, 2015 - link

    I hope that AMD can survive until Zen, because it actually sounds quite promising based on what we've been hearing. In the years following Bulldozer so many people have said AMD needs to scrap it and start from scratch, which I've always found a little odd. Not the scrapping Bulldozer part, that definitely needs to go, but the starting from scratch part. AMD has a great architecture right now that could serve as the base for future designs, Jaguar and its successor Puma. When Jaguar first launched I really thought it was the most impressive architecture to come out of AMD since K8, and it only got better with Puma. I thought AMD could have a real winner on their hands if they beefed up this architecture and took it to another performance level, similar to what Intel did with its Pentium M. Recent rumors about Zen's architecture being based on Puma actually have me pretty excited. I just hope AMD can hold out until 2016.

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