The perpetually struggling AMD announced Tuesday that it would sell and lease back its corporate campus in Austin, Texas to generate $164 million in cash. It’s a quick way to make a buck, but it could raise questions about the long-term viability of the company.
Nokia pulled the same trick with its Helsinki headquarters back in December 2012, raising $220 million—and Nokia is another struggling company.
In January 2013, AMD announced it had hired new executives to focus the company in the mobile CPU sector, which came after a lawsuit accusing former employees of stealing company secrets. The company suffered a net loss of $1.18 billion in 2012 and has noticeably reduced its chip manufacturing capability.
Last fall, a Wall Street analyst called AMD “un-investable,” following the announcement of its terrible Q3 2012 numbers and the sudden loss of its CFO.
“We have no further confidence that any aspect of our prior structural thesis (margin accretion, cash flow, and balance sheet deleveraging) will play out in the foreseeable future,” Bernstein Research‘s Stacy Rasgon wrote in an investor’s note in October 2012.
Ars will have a lengthy feature later this month that will detail the company’s past and present challenges (the article includes interviews with the former CEO, Hector Ruiz, and other high-level former executives).
UPDATE 1:30pm CT: Michael Silverman, an AMD spokesperson, wrote to Ars with the following comment:
Seems like you included what may be one of the very worst things said about AMD from a financial analyst from last fall (“un-investable”) without any balance of mentioning the progress that has been made in the following six months, e.g., the recently announced Sony Playstation 4 APU semi-custom part win, today’s newly announced Richland mobile APU part and the related APU and GPU/Radeon announcements on new products we made at CES, which also included a new customer for us: VIZIO. Of course, talk is cheap—we need to deliver not just on the product front but also show progress in our financials. But it would be fair to say that the roadmap is largely well-received and the new products look good to our partners and customers.
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