AMD Takes a Knee: Fool by Numbers

Fast facts the Foolish way.

By Anders Bylund – Updated Apr 5, 2017 at 5:20PM EST

On Oct. 18, microprocessor maker Advanced Micro Devices (NYSE:AMD) released third-quarter earnings for the period ending Sept. 29, 2007.

They weren't pretty but could have been much worse. Gross margins were about 8 percentage points worse last quarter, and the net loss was about 33% lower.
Operating cash flow is back to the cheery levels of yesteryear already, although hefty capital expenses ensure that the cash balance trickles downward regardless.
These financial troubles are AMD's alone and not the industry's; note how AMD's prominent competitors remain profitable and get more CAPS respect.

(Figures in millions, except per-share data.)

Income Statement Highlights

	Q3 2007	Q3 2006	Change
Sales	$1,632	$1,328	22.9%
Net Profit	($396)	$136	N/A
EPS	($0.71)	$0.27	N/A
Diluted Shares	554	497	11.5%

Get back to basics with the income statement.

Margin Checkup

	Q3 2007	Q3 2006	Change*
Gross Margin	41.0%	51.4%	(10.4)
Operating Margin	(13.9%)	9.0%	(22.8)
Net Margin	(24.3%)	10.1%	(34.4)

*Expressed in percentage points.

Margins are the earnings engine.

Balance Sheet Highlights

Assets	Q3 2007	Q3 2006	Change
Cash + ST Invest.	$1,528	$2,357	(35.2%)
Accounts Rec.	$682	$688	(0.9%)
Inventory	$839	$466	80.2%

Liabilities	Q3 2007	Q3 2006	Change
Accounts Payable	$1,064	$901	18.0%
Long-Term Debt & Capitalized Lease Obligations	$5,117	$3,672	39.4%

The balance sheet reflects the company's health.

Cash Flow Highlights

	Q3 2007	Q3 2006	Change
Cash From Ops.	$223	$230	(3.0%)
Capital Expenditures	$419	$425	(1.4%)
Free Cash Flow	($196)	($195)	(0.7%)
Owner Earnings	($481)	($91)	(428.5%)

Free cash flow is a Fool's best friend.

Competitive Context

	Market Cap	P/E Ratio	CAPS Rating
AMD	$8,040	N/A	**
Intel (NASDAQ:INTC)	$157,500	27.7	***
NVIDIA (NASDAQ:NVDA)	$21,700	41.0	*****
Sun Microsystems (NASDAQ:JAVA)	$21,230	45.8	***
QUALCOMM (NASDAQ:QCOM)	$69,330	25.2	***

The latest reported numbers from Capital IQ. Nobody is anybody without some context.

Related Foolishness:

Anders Bylund is a contributing Motley Fool media and technology analyst covering semiconductors, cloud computing, internet infrastructure, quantum computing, and streaming media. Previously, Anders was a systems administrator for Nielsen Technology and CSX, gaining hands-on experience with enterprise-class systems. He was also a freelance writer for Ars Technica, TIME, USA Today, CNN, WIRED, and AOL's Daily Finance. He holds a bachelor’s degree in English and a master’s degree in library and information sciences from Florida State University. He believes in coyotes and time as an abstract.

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