AMD makes new loss quarter – tracks better times with Ryzen and Vega

After several difficult years of reorganization and product portfolios that have not always been able to compete with the competition, it is about to turn around for AMD. However, the company still has a long way to go before they can count on making a profit again, something AMD themselves are pushing for when they present the figures for the fourth quarter of 2016.

During the period, AMD’s revenue fell from $ 1.31 billion to $ 1.11 billion, but rose from $ 958 million on an annual basis. That AMD saw a decline quarter by quarter is seasonal, as system builders and game console makers Microsoft and Sony make their purchases during the third quarter before Christmas shopping.

Operating profit for the quarter lands at minus 3 million and the company’s loss of 51 million. On the positive side, the company’s gross margin rose by 2 percentage points on an annual basis to 32 percent. The reason is attributed to increased sales of processors and graphics cards, where margins are larger than tailored system circuits for Sony and Microsoft game consoles.

The latter is reflected in the results for the division Computing and Graphics, which includes processors, control circuits and graphics cards. In particular, increased sales of graphics cards contributed to the category withdrawing 600 million and making a loss of 21 million, compared to 472 million and a loss of 66 million for the third quarter of 2016.

The bright spot for AMD is again Enterprise, Embedded and Semi-Custom, which includes the system circuits for Playstation 4 and Xbox One. Revenue lands at 506 million and profit at 47 million, which is a decrease from the third quarter where the category pulled in 835 million and gave a profit of 136 million.

And with the new products that are coming up, in particular the Ryzen product we just talked about, with better gross margins and other products in the graphics base, we expect to continue to make progress in that segment and reduce the losses and get back to profitability.

For the first quarter of the year, AMD expects revenue to decline by 11 percent (plus-minus 3 percentage points), which would still be an increase of 18 percent compared to Q1 2016. Furthermore, the company expects to make a profit again after the launches of Ryzen and the graphics architecture Vega .