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Sat, Apr 17, 2010 - Page 10 News List

AMD racks up Q1 profit as computer market strengthens

AP , SAN FRANCISCO

Advanced Micro Devices Inc returned to profitability in the first quarter as the world’s No. 2 microprocessor maker benefited from a strengthening computer market.

The company also got a lift from an accounting boost related to the manufacturing division it spun off last year. But more importantly, the quarter’s numbers suggest that AMD is being helped by broad trends that could lift many kinds of technology suppliers.

This week, AMD’s main rival in the business of selling the chips that are the “brains” of computers, Intel Corp, said that its first-quarter profit nearly quadrupled. It said consumer demand for laptops and corporate spending on computer servers were strong.

Market research firms IDC and Gartner Inc said personal computer shipments jumped more than 20 percent in the first quarter, which was more than expected.

AMD CEO Dirk Meyer described spending on servers as “pretty healthy” and said on a conference call with analysts that he was optimistic the trend would hold through the rest of the year.

However, he wouldn’t discuss his projections for corporate spending on personal computers, an area that has been slow to recover.

AMD said after the market closed on Thursday that it earned US$257 million, or US$0.35 per share in the first quarter. In the same period last year AMD lost US$416 million, or US$0.66 per share.

Excluding the gain from the manufacturing spinoff, AMD would have earned US$0.09 per share in the most recent quarter. Revenue jumped 34 percent to US$1.57 billion.

The company predicted that revenue would decline from the first to second quarter, in line with seasonal trends.

Analysts were predicting US$1.53 billion in revenue for the second quarter.

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