Quarter still in the red for AMD, but a joint venture on the horizon

Yesterday evening AMD has released its financial results for the first three months of 2016, with an even operating at a loss because of $ 68 million with a turnover of 832 million dollars. In comparison with the same period last year the company reported a significant sales decline, equal to -19%, although with a loss that is less than that of the previous 12 months.

In terms of net AMD quarterly result ended Q1 2016 with a loss of 109 million dollars, 180 million less than in Q1 2015, but slightly higher than the 102 million loss for the fourth quarter 2015.

Computer Graphics division and totaled sales of $ 460 million, down 14% compared to Q1 2015, producing a quarterly loss of $ 70 million. For the division Enterprise, Embedded and Semi-Custom turnover for the period amounted to $ 372 million, down 25% from the previous year: this has led to a quarterly profit decline, down from the previous 45 million of dollars to the current 16 million. The estimates for the first three months of 2016 are an increase in turnover of 15%, with a 3% margin of fluctuation upwards or downwards.

On the sidelines of financial data AMD announced that it has signed an agreement with Tianjin Haiguang Advanced Technology Investment Company, Limited (THATIC), a Chinese company that is engaged in the production of system-on-chip solutions for the Chinese server market. The two companies will form a joint venture in which the contribution of AMD will focus on intellectual property assignment she held related to the x86 architecture and development of SoC systems: the purpose of the joint veture is developing SoC solutions with high performance as well as of processors intended for use in the server business for the Chinese market.

The part of THATIC will be to provide more technological resources, in addition to the financial component for the development of projects: for AMD this agreement will lead to a payment to AMD of $ 293 million to licensing, in addition to any other earnings away in future royalties. The $ 293 million will be paid to AMD at various times better not specified, in conjunction with the achievement of specific objectives in the development process of new products of the joint venture.

For the present moment there is no specific information about which technologies and architectures from AMD will be used by the joint venture is in any case of intellectual property related to the production of CPU and not the GPU, and it is conceivable since the target audience that AMD can use at least parts of the future architecture Zen for products developed by the joint venture.