James Delahunty
22 Jan 2010 9:55
Thanks to a $1.25 billion settlement between Intel and Advanced Micro Devices (AMD) in an antitrust battle, AMD has posted its first quarterly profit in three years. AMD did benefit from a lift in the computer market, with microprocessor and graphics chip unit sales increasing, although prices have fallen too. Revenue was up 42 percent over the same period of last year, totaling $1.6 billion (just ahead of the $1.5 billion analysts expected).
AMD admits that it would have last money if it wasn't for the Intel settlement. For 2009, AMD's net income was $304 million with revenue at $5.4 billion, compared to 2008 when AMD made a net loss of $3.1 billion with revenue of $5.8 billion. Intel reported last week its highest gross profit margin in the company's history with better sales in all of its major product categories.
The $1.25 billion settlement it paid to AMD brought an antitrust suit due to go to trial in March to an early end. AMD originally filed the lawsuit against Intel in 2005. The deal does not bring to an end other cases against Intel that AMD has been vocally supportive of. It has complained to antitrust regulators around the world about Intel's sales tactics, which it alleges are illegal.
The European Union has fined Intel a record $1.45 billion and Intel was also hit by an antitrust lawsuit brought by the U.S. Federal Trade Commission. There are also separate cases in New York and South Korea. Intel denies the allegations of wrong-doing in all of the above cases and is fighting off each.