AMD aims to turn a profit by year's end

 

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By Reuters

Posted on 19 May 2009 at 08:53

AMD expects to be making a profit by year's end, according to the company's chief executive.

Speaking at the Global Technology Summit in New York, Dirk Meyer claimed AMD's main division would end the year profitable and with positive free cash flow if the PC market improves in the second half, as is the case usually.

"On the assumption we return to at least nominal seasonality from a growth perspective, we'll be in good shape to leave this year with a profit and free cash flow," he said. "I'm hopeful things will stabilise and we'll see a resumption of growth in the back half of the year."

Meyer also said the company was done with restructuring and layoffs, following a January announcement that it would slash 1,100 jobs over the year.

Meyer said the company has cut costs to the extent that it could break even when revenue reaches $1.3 billion a quarter, or a little less than $5.5 billion annual revenue. AMD's previous break-even point had been $8 billion revenue at the end of 2007.

Looking ahead, AMD is looking to make inroads into the low-cost processor market currently dominated by Intel's Atom.

Meyer was giving his first speech since the European Commission last week ruled that Intel Corp had given illegal rebates to computer makers to try and depress AMD's market share.

Intel was ordered to end its practices with immediate effect. Meyer said he expected no "light switch" effect from the ruling, but was optimistic about the company's future.

"Over time, it's going to allow us to more successfully compete for business," he said.