AMD Reports 2015 Fourth Quarter and Annual Results

AMD announced revenue for the fourth quarter of 2015 of $958 million, operating loss of $49 million and net loss of $102 million, or $0.13 per share. Non-GAAP⁽¹⁾ operating loss was $39 million, non-GAAP⁽¹⁾ net loss was $79 million and non-GAAP⁽¹⁾ loss per share was $0.10. While the results may be worry some in certain aspects and rather interesting overall, the company seems to be on the right path to better earnings, income and overall, a better future, thanks to their newest hardware releases and developments made.

“AMD closed 2015 with solid execution fueled by the second straight quarter of double-digit percentage revenue growth in our Computing and Graphics segment and record annual semi-custom unit shipments,” said Dr. Lisa Su, AMD president and CEO.  “While 2015 was challenging from a financial perspective, key R&D investments and a sharpened focus on innovation position us well to deliver great products, improved financial results and share gains in 2016.”

• 2015 Annual Results

  • Revenue of $3.99 billion, down 28 percent year-over-year, primarily due to lower client processor sales.
  • Gross margin of 27 percent, down 6 percentage points year-over-year and non-GAAP⁽¹⁾ gross margin of 28 percent, down 7 percentage points year-over-year.  The year-over-year declines were primarily due to lower unit volumes and product mix.
  • Operating loss of $481 million and non-GAAP⁽¹⁾ operating loss of $253 million, compared to a loss of $155 million and non-GAAP⁽¹⁾ operating income of $316 million in 2014 primarily due to lower revenue and gross margin.
  • Net loss of $660 million, loss per share of $0.84, and non-GAAP⁽¹⁾ net loss of $419 million, non-GAAP⁽¹⁾ loss per share of $0.54, compared to a net loss of $403 million, loss per share of $0.53, and non-GAAP⁽¹⁾ net income of $132 million, non-GAAP⁽¹⁾ earnings per share of $0.16 in 2014.

• Q4 2015 Results

  • Revenue of $958 million, down 10 percent sequentially primarily driven by seasonally lower sales of semi-custom SoCs and down 23 percent year-over-year, primarily due to lower client processor sales.
  • Gross margin of 30 percent, up 7 percentage points sequentially. Q3 2015 gross margin was negatively impacted by an inventory write-down of $65 million, or 6 percentage points.  Excluding the Q3 2015 inventory write-down, non-GAAP gross margin improved 1 percentage point sequentially, primarily due to improved product mix in the Computing and Graphics segment.
  • Operating loss of $49 million, compared to an operating loss of $158 million for the prior quarter. Non-GAAP⁽¹⁾operating loss of $39 million, compared to non-GAAP⁽¹⁾ operating loss of $97 million in Q3 2015, primarily due to higher gross margin and lower operating expenses.
  • Net loss of $102 million, loss per share of $0.13, and non-GAAP⁽¹⁾ net loss of $79 million, non-GAAP⁽¹⁾ loss per share of $0.10, compared to a net loss of $197 million, loss per share of $0.25 and non-GAAP⁽¹⁾ net loss of $136 million, non-GAAP⁽¹⁾ loss per share of $0.17 in Q3 2015.
  • Cash and cash equivalents were $785 million at the end of the quarter, up $30 million from the end of the prior quarter, primarily due to improved operating cash flow.
  • Total debt at the end of the quarter was $2.26 billion, flat from the end of the prior quarter.

Quarterly Financial Segment Summary

• Computing and Graphics segment revenue of $470 million, an increase of 11 percent sequentially and a decrease of 29 percent from Q4 2014. The sequential increase was primarily due to higher notebook processor sales, and the year-over-year decrease was primarily driven by lower client processor sales.
  • Operating loss was $99 million, compared to an operating loss of $181 million in Q3 2015 and an operating loss of $56 million in Q4 2014. The sequential improvement was driven primarily by higher sales and the absence of a Q3 2015 inventory write-down and the year-over-year decrease was primarily driven by lower sales.
  • Client average selling price (ASP) increased sequentially driven by a richer notebook processor product mix and decreased year-over-year due to a lower notebook processor ASP.
  • GPU ASP increased sequentially and year-over-year primarily due to a higher AIB channel ASP.
• Enterprise, Embedded and Semi-Custom segment revenue of $488 million, a decrease of 23 percent sequentially primarily driven by seasonally lower sales of semi-custom SoCs. Revenue decreased 15 percent from Q4 2014 primarily driven by lower game console royalties, and server and embedded revenue.
  • Operating income was $59 million compared with $84 million in Q3 2015 and $109 million in Q4 2014. The sequential decrease was primarily due to seasonally lower sales of semi-custom SoCs.  The year-over-year decrease was primarily due to lower game console royalties, and server and embedded sales.
• All Other operating loss was $9 million compared with operating losses of $61 million in Q3 2015 and operating loss of $383 million in Q4 2014. The sequential improvement was primarily due to Q3 2015 restructuring and other special charges and the year-over-year improvement was primarily due to the absence of a goodwill impairment charge, lower restructuring and other special charges, net and a Q4 2014 lower of cost or market inventory adjustment.

Source: AMD