ATI acquisition costs AMD another $880 million

AMD has announced that it will take charges totaling $948 million in its recently ended quarter for goodwill impairment and restructuring. A whopping $880 million of that is made up of charges for related to its acquisition of ATI Technologies.

This latest round of write offs mean that AMD has effectively written off more than half of the total ATI purchase price.

So, $880 million on ATI charges, $36 million in impairment charges related flash memory chip maker Spansion, $32 million in restructuring charges for employee severance ... it all adds up. In fact, about the only good bit of news is that AMD managed to claw back $190 million through selling 200-millimeter wafer fabrication tools.

Bottom line - none of this bodes well for AMD's Q2 08 earnings release scheduled for Jul 17. I'm expecting the company to post yet another round of losses, which will make it the seventh in a row for the chipmaker.

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To be honest with you, I worry about the hole that AMD has dug for itself, and it would seem that its answer to the financial problems is to keep digging. Stock is at a 5-year low and the no one at the top of the company seems to be coming up with anything remotely resembling a recovery plan. that's a shame because we'll all suffer if Intel doesn't have a serious competitor.

Thoughts?