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AMD May Spin Off Network-Chip Unit

July 10, 1998|Bloomberg News

Advanced Micro Devices Inc. may seek to raise money by spinning off its Vantis unit, which makes programmable-logic devices used in data-networking equipment. The Sunnyvale chip maker outlined the plan in a regulatory document filed a day after the company reported a larger-than-expected $64.6-million second-quarter loss. A Vantis spinoff "may represent a low-cost financing source," said Tad LaFountain, an analyst at Needham & Co. The firm "has gone through cash at a fairly prodigious rate," said LaFountain, who has a "buy" rating on AMD. The company lost $64.6 million, or 45 cents a diluted share, in the second quarter, compared with a profit of $9.97 million, or 7 cents, in the same period a year earlier. Analysts expected AMD to lose 20 cents a share, according to First Call Corp. AMD shares fell $2.25 to close at $15.88 on the NYSE.

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