Richard, read it and weep:
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AMD Reports First Quarter Results; AMD Sales Grow on Record PC Processor Sales
SUNNYVALE, Calif.--(BUSINESS WIRE)--April 18, 2001--AMD today reported sales of $1,188,747,000 and net income of $124,837,000 for the quarter ended April 1, 2001. Net income amounted to $0.37 per diluted share. The company reported record sales and record unit shipments of PC processors, led by strong sales of its seventh-generation AMD Athlon(TM) and AMD Duron(TM) processors.
Total sales grew by 9 percent over the like period of 2000 while increasing by 1 percent from the immediate-prior quarter. In the first quarter of 2000, AMD reported sales of $1,092,029,000 and net income of $189,349,000, or $0.55 per diluted share. The company noted the tax rate for the just-completed quarter was 32 percent versus zero in the comparable period of 2000. In the fourth quarter of 2000, AMD reported sales of $1,175,172,000, and net income of $177,968,000, or $0.53 per diluted share, with a 15 percent tax rate.
AMD sold more than 7.3 million PC processors, including 6.5 million seventh-generation AMD Athlon and Duron processors. Average selling prices (ASPs) increased from the immediate-prior quarter on the richer product mix. Total PC processor sales, at $661 million, increased 17 percent from both the comparable quarter of 2000 and the immediate-prior quarter.
"AMD had an excellent quarter in a challenging economic environment," said W.J. Sanders III, chairman and chief executive officer. "The superiority of our seventh-generation PC processors enabled AMD to achieve record PC processor sales in both dollars and units even as the industry worked through inventory issues in a softening economy. Our success in the PC processor arena reflects continuing excellent execution as well as our ability to supply products with more delivered performance that enhance the competitiveness of our customers.
"New product introductions during the quarter strengthened and broadened our PC processor portfolio," Sanders continued. "We commenced volume shipments of our newest, power-managed AMD Athlon processors, code-named `Palomino,' for the mobile PC market segment. Palomino processors feature an enhanced core and our proprietary PowerNow! technology, which dynamically adjusts the frequency and voltage of the processor based on the performance demands of the software, enabling a significant reduction in power consumption in mobile applications. PowerNow! technology is just one example of the better ideas from AMD that have elevated us to contention with IBM for the number two global ranking in U.S. patent issuances relating to large-scale integration processes and devices in 2000.
"AMD also introduced 1.3-gigahertz (GHz) and 1.33-GHz desktop versions of the AMD Athlon processor in the first quarter. Earlier this month, AMD introduced a 900-megahertz version of the AMD Duron processor, the industry's highest-performance processor for the value segment of the desktop market.
"With these additions to our PC processor offerings, we have a compelling solution for the performance mobile PC market where we have heretofore lacked a competitive offering while extending our performance leadership for desktop PC applications," Sanders continued.
"Sales of flash memory products, reflecting a sharp decline in demand from the communications sector of the economy, declined by approximately 10 percent sequentially to $411 million," Sanders continued. "Our broad product offering, excellent relationships with major customers, and long-term purchase agreements helped to mitigate the effects of this challenging environment and achieve 26 percent growth in flash memory product sales over the like period of 2000.
"We gained market share last quarter in both PC processors and flash memory, the focal points of our growth strategy," Sanders said.
"Sales of our seventh-generation processors (AMD Athlon and AMD Duron processors) grew 27 percent sequentially and 126 percent year-on-year. Demand for our highest-performance AMD Athlon processors remained strong and we shipped more than 2 million 1-GHz and faster devices. Going forward, we plan to continue our aggressive production ramp in Fab 30 in Dresden, which will be the source of our highest-performance AMD Athlon processors, including the new power-managed versions," Sanders concluded.
Current Outlook
The company's outlook statements are based on current expectations. The following statements are forward-looking, and actual results could differ materially. The company's current outlook is based on the following projections.
The company currently expects that, in the seasonally slow second quarter for PC sales, the enhanced competitive position of AMD-based solutions will enable maintenance of PC processor unit sales at near-record levels comprised totally of seventh-generation products. The company currently expects PC industry unit growth in the high single-digit range for 2001 as a whole.
Uncertainties regarding the level of demand for flash memory products in a continuing soft communications sector makes forecasting memory product sales extremely difficult. The company currently projects that second quarter sales of flash memory products will decline sequentially.
AMD's other IC products and foundry services, which currently account for less than 10 percent of corporate revenues, will continue their decline both in absolute terms and as a percentage of total revenues.
Accordingly, in this uncertain climate, AMD expects that overall second quarter revenues could decline by as much as 10 percent sequentially, depending on market conditions.
For the year as a whole, on modest sales growth in a declining market, the company expects to earn $1.50 per diluted share, consistent with First Call consensus earnings estimates.
AMD Teleconference
AMD will hold a teleconference for the financial community at 2:30 PM Pacific Standard Time today to discuss first-quarter financial results. AMD will provide a real-time audio broadcast of the teleconference on the Investor Relations page of its web site at amd.com or streetfusion.com. The webcast will be available for two weeks after the teleconference. |
