Despite the spin-off, AMD is a switch

Article Excerpt

ADVANCED MICRO DEVICES INC. $41 (New York symbol AMD; WSSF Rating: Extra risk) is the world’s second-largest maker of computer processor chips after Intel Corp. The company also makes flash memory chips through Spansion Inc., a joint venture with Japan’s Fujitsu Ltd. Flash chips retain data in mobile phones and other devices, even when a user turns off the power. However, overcapacity in the flash memory industry has hurt Spansion’s earnings in the past few years. That’s why AMD and Fujitsu sold Spansion shares to the public in December 2005. The sale cut AMD’s stake in Spansion, from 60% to 37.9%. AMD may hand out its remaining Spansion shares to its own stockholders in the next year or two. The Spansion sale generated a one-time charge of $110 million. If you exclude all unusual items, AMD earned $0.45 a share (total $205 million) in the fourth quarter of 2005. It lost $0.08 a share ($30 million) a year earlier. Revenue rose 38.5%,…

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