Advanced Micro Devices Inc. Earnings: Swing to a Loss After Two Straight Profit Quarters

S&P 500 (NYSE:SPY) component Advanced Micro Devices Inc. (NYSE:AMD) reported its results for the fourth quarter. Advanced Micro Devices is a semiconductor company with manufacturing, research and development, and sales and administrative facilities throughout the world. It provides processing solutions for the computing and graphics markets.

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Advanced Micro Devices Earnings Cheat Sheet for the Fourth Quarter

Results: Reported a loss of $177 million (24 cents per diluted share) in the quarter. The semiconductor company had net income of $375 million or 50 cents per share in the year earlier quarter.

Revenue: Rose 2% to $1.69 billion from the year earlier quarter.

Actual vs. Wall St. Expectations: AMD reported adjusted net income of 19 cents per share. By that measure, the company beat the mean estimate of 16 cents per share. Analysts were expecting revenue of $1.72 billion.

Quoting Management: “AMD shipped more than 30 million APU’s in 2011, resulting in record annual notebook revenue,” said Rory Read, AMD president and CEO. “The unmatched combination of computing and graphics capabilities in our low-power ‘Brazos’ platform has made it our fastest ramping platform ever, paving the way for continued growth in key segments and geographies. Our server business has re-gained momentum, delivering two consecutive quarters of strong sequential growth.”

Key Stats:

The company has now topped analyst estimates for the last four quarters. It beat the mark by 5 cents in the third quarter, by one cent in the second quarter, and by 3 cents in the first quarter.

The company’s loss in the latest quarter follows profits in the previous three quarters. The company reported a profit of $97 million in the third quarter, a profit of $61 million in the second quarter and $510 million in the first.

Margins rose in the third quarter after falling the quarter before. Gross margin rose 0.6 percentage point to 45.7% from the quarter earlier quarter. In the second quarter, the figure rose 0.9 percentage point to 44.7% from the year earlier quarter.

The company’s revenue has now risen for two straight quarters. In the third quarter, revenue increased 4.4% to $1.69 billion from the year earlier quarter.

Looking Forward: Analysts appear increasingly negative about the company’s results for the next quarter. The average estimate for the first quarter of the next fiscal year has moved down from 12 cents a share to 10 cents over the last sixty days. The average estimate for the fiscal year is 47 cents per share, a rise from 42 cents ninety days ago.

Competitors to Watch: Intel Corporation (NASDAQ:INTC), NVIDIA Corporation (NASDAQ:NVDA), MIPS Technologies, Inc. (NASDAQ:MIPS), Texas Instruments Inc. (NYSE:TXN), ARM Holdings plc (NASDAQ:ARMH), Microsoft Corporation (NASDAQ:MSFT), Intl. Business Machines Corp. (NYSE:IBM), Hewlett-Packard Company (NYSE:HPQ), Broadcom Corporation (NASDAQ:BRCM), and Apple Inc. (NASDAQ:AAPL).

Stock Performance: Shares of AMD were up 0.2% from the previous close.

Investing Insights: Will the iPad 3 Be the Next Catalyst for Apple’s Stock?

(Company fundamentals provided by Xignite Financials. Earnings estimates provided by Zacks)

To contact the reporter on this story: Derek Hoffman at staff.writers@wallstcheatsheet.com

To contact the editor responsible for this story: Damien Hoffman at editors@wallstcheatsheet.com