By Paul Kunert
14 July 2008
AMD has revealed it will pay an $880m (£442m) impairment charge for the second quarter related to the underperforming Consumer Technology Business division at subsidiary ATI.
The write downs for the three months ended 28 June are in connection to weaker than expected sales at ATI's Handheld and DTV business units, though AMD said it will not have the pay for the charges in cash.
“The Company’s estimate is that the goodwill and intangible asset impairment charges will be approximately $880m,” said AMD in the filing.
Adding to its woes, AMD said it would take a $32m charge as part of the downsizing that began at ATI this quarter, $24m in investment impairment charges associated with the ownership of Spansion stock and $12m connected to Auction Rate Securities.
The only glimmer of positive news came after the chip maker said it expected gains in connection with the sales of certain 220mm wafer fabrication tools that it expected to improve gross margin by $190m.
AMD second quarter results are due on Thursday
