AMD Posts Staggering 2nd-Quarter Loss

Semiconductor maker Advanced Micro Devices Inc. reported a staggering second-quarter loss despite better-than-expected sales of its new K6 computer chip. The Sunnyvale-based company, which makes Intel-compatible microprocessors and other computer chips, posted a net loss for the quarter ended June 28 of $64.5 million, or 45 cents a share, on revenue of $526.5 million. That contrasts with a profit of $10 million, or 7 cents a share, on revenue of $594.5 million in the year-ago quarter. Analysts had expected the company to report a loss for the latest quarter of 20 cents a share, according to First Call research service. AMD shipped 2.7 million units of its new K6 Pentium clone chip during the quarter, 700,00 more than it previously forecast. AMD introduced the K6 chip with improved multimedia technology in May. The K6 was the first upgrade of AMD’s microprocessor since it was launched in April 1997. But strength in the K6 business failed to offset weaker sales of Advanced Micro’s non-chip products as well as its memory chips. AMD shares rose 13 cents to close at $18.13 on the New York Stock Exchange. Results were released after the markets closed.