Today AMD has announced their third quarter earnings for fiscal year 2015. AMD saw a 13% increase in revenue over Q2 2015, but revenues were down almost 26% over their Q3 2014 numbers. Revenue for the quarter was $1.06 billion USD, down from $1.43 billion a year ago. AMD continues to use GAAP and Non-GAAP earnings to help show the state of the business in greater detail. On a GAAP basis, AMD had an operating loss of $158 million for the quarter, and a $197 million net loss, which works out to $0.25 per share. Compared to last quarter, both losses were larger despite the increased revenue, and the numbers are down significantly over the $17 million net income a year ago.

AMD Q3 2015 Financial Results (GAAP)
  Q3'2015 Q2'2015 Q3'2014
Revenue $1.06B $942M $1.43B
Gross Margin 23% 25% 35%
Operating Income -$158M -$137M $63M
Net Income -$197M -$181M $17M
Earnings Per Share -$0.25 -$0.23 $0.02

On a Non-GAAP basis, AMD had a $97 million operating loss, which is once again a larger loss than last quarter, and down 211% from the $87 million in operating income last year. Net loss was $136 million, or $0.17 per share, compared to a $41 million net profit and $0.05 per share last year. GAAP to Non-GAAP differences are due to $48 million in restructuring fees and $13 million in stock based compensation.

AMD Q3 2015 Financial Results (Non-GAAP)
  Q3'2015 Q2'2015 Q3'2014
Revenue $1.06B $942M $1.43B
Gross Margin 23% 28% 35%
Operating Income -$97M -$87M $87M
Net Income -$136M -$131M $41M
Earnings Per Share -$0.17 -$0.17 $0.05

The Computing and Graphics segment continues to struggle, although AMD did see stronger sequential growth here with the recent launch of Carrizo. Revenue increased 12% over last quarter, although it is still down 46% year-over-year. This segment had an operating loss of $181 million for the quarter, up from a loss of $147 million last quarter and a loss of $17 million a year ago. Sequentially, the loss is mostly attributed to a write-down of $65 million which AMD is taking on older-generation products. Annually, the decrease is due to lower overall sales. Unlike Intel, AMD processors had a decrease in Average Selling Price (ASP) both sequentially and year-over-year, so there was no help there from the lower sales volume. The GPU ASP was a different story, staying flat sequentially and increasing year-over-year. Recent launches of new AMD graphics cards have helped here.

AMD Q3 2015 Computing and Graphics
  Q3'2015 Q2'2015 Q3'2014
Revenue $424M $379M $781M
Operating Income -$181M -$147M -$17M

The Enterprise, Embedded, and Semi-Custom segment had a better showing. Revenue increased 13% over last quarter, and was down only 2% year-over-year. Semi-custom sales (read Consoles) drove the sequential increase but lower embedded and server processor sales caused a year-over-year decline. Operating income for this segment came in at $84 million, up from $27 million in Q2 but down from $108 million in Q3 2014. Q2’s numbers were skewed though by a $33 million hit on moving to a new process node.

AMD Q3 2015 Enterprise, Embedded and Semi-Custom
  Q3'2015 Q2'2015 Q3'2014
Revenue $637M $563M $648M
Operating Income $84M $27M $108M

All Other had an operating loss of $61 million for the quarter, up from $17 million loss in Q2 and a $28 million loss in Q3 2014. This is where they stick their “restructuring charges” and they nicely align with the GAAP vs Non-GAAP values.

The bad news doesn’t stop here either. We’ve seen the departure of a couple of key people at AMD, and AMD is also spinning off some of the company. Revenues for Q4 are expected to decrease an additional 10%, plus or minus 3%, compared to today’s numbers. AMD is doing more corporate restructuring in an attempt to reduce expenses further. Perhaps the most troubling aspect of today’s results is their gross margin is only 23%. They really need closer to 35% for profitability and are a long way from that today.

Source: AMD Investor Relations

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  • Jtaylor1986 - Thursday, October 15, 2015 - link

    For reference BlackBerry is acquiring companies to expand (Good Technology) with it's surplus while AMD has to sell pieces of itself to make sure it doesn't go into chapter 11 before it can release Zen. Reply
  • melgross - Friday, October 16, 2015 - link

    Blackberry is going to go away, one way or the other. Their best hope is to become just another MDM, which will basically be Good with the Blackberry name.

    AMD is already mostly there. Long term, they will either be bought out, or fail, or become some small custom chip house.
    Reply
  • Morawka - Thursday, October 15, 2015 - link

    i think apple is trying to save AMD by putting AMD GPU's in their imac's and mac pro's.. But it's not working apple.. sorry ya old farts.. Apple is run by a bunch of 60 year old dudes. Reply
  • mdriftmeyer - Friday, October 16, 2015 - link

    Right. They're the largest generating profit machine on the planet, because they are old dudes out of touch. Educate yourself before hand.

    The Macbook Pro with upcoming AMD GPGPUs will further cement AMD in all lines but the Mac Mini.

    2016 will most likely be when Apple updates their FirePro line of Mac GPGPUs right after AMD makes them HBM2 ready.
    Reply
  • sheeple - Monday, October 19, 2015 - link

    Old dudes out of touch, LOL more like gay-loving jerks! Reply
  • SeanJ76 - Tuesday, October 27, 2015 - link

    This is true, Apple is a gay persons product(and for stupid women) Reply
  • prtskg - Friday, October 16, 2015 - link

    amd gpus are cheaper except the fijis. apple has low level api so they can extract more performance out of it like dx12 benchmarks shows. and like it or not apple is quite a profitable company. Reply
  • SeanJ76 - Tuesday, October 27, 2015 - link

    Too bad every cpu/gpu in a Apple is Intel/Nvidia....so Apple doesn't really make anything of their own. Reply
  • osxandwindows - Friday, October 16, 2015 - link

    You idiot its because of 5k Reply
  • melgross - Friday, October 16, 2015 - link

    You are insane. Reply

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