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AMD posts third quarter loss; Signs of improvement

AMD reported strong third quarter revenue growth Thursday, but not enough to make the company turn a profit.AMD reported a net loss of $396 million, or 71 cents a share, on revenue of $1.

AMD reported strong third quarter revenue growth Thursday, but not enough to make the company turn a profit.

AMD reported a net loss of $396 million, or 71 cents a share, on revenue of $1.63 billion. The loss tally includes a charge of 22 cents a share due to the acquisition of ATI. Wall Street was looking for a loss of 62 cents a share, according to Thomson Financial.

There were positive signs that AMD is on the right track. AMD's revenue was up 18 percent from the second quarter and 23 percent from the third quarter a year ago. Overall, AMD's financials are headed in the right direction, but it's too early to call whether the company's new quad-core Opteron processors can deliver profits.

AMD gave the following outlook: In the "seasonally up fourth quarter, AMD expects revenue to increase in line with seasonality."

In a statement, AMD CFO Robert Rivet said the company "was encouraged by the progress" in the quarter and sold a record number of chips and began revenue shipments of the quad-core Opteron formerly known as Barcelona. The company's gross margins in the third quarter also improved to 41 percent, up from 33 percent in the second quarter, but down from 51 percent in the third quarter a year ago.

However, relative to Intel's third quarter, AMD has some work to do.

Other odds and ends:

  • Microprocessor unit shipments increased 16 percent sequentially;
  • Mobile processor unit shipment growth increased 41 percent sequentially;
  • The company had $1.53 billion in cash on hand.