A.M.D.’s Profit Bolstered by Sales of Chips for Netbooks

SAN FRANCISCO (Reuters) — The chip maker Advanced Micro Devices topped earnings expectations for the quarter on Thursday and predicted revenue in the current period that was in line with forecasts.

The company said it had strong demand for its recently released chips aimed at netbooks, a niche dominated by its larger rival Intel, but which is also under pressure from increasing tablet sales.

The chief executive of A.M.D., Dirk Meyer, left the company in early January after disagreements with its board about what the company’s strategy in the growing market for tablets and smartphones should be, and he has yet to be replaced.

Net income in the first quarter was $510 million, or 68 cents a share, compared with $257 million, or 35 cents a share, in the same period last year.

Revenue was $1.61 billion, up 2 percent year over year.

The company, based in Sunnyvale, Calif., said it expected second-quarter revenue to be flat or slightly down, compared with the first quarter.

Analysts had expected revenue of $1.61 billion for the first quarter and $1.59 billion for the second quarter.

On the basis of nongenerally accepted accounting principles, A.M.D. said its earnings were 8 cents a share, higher than the 5 cents that analysts on average expected, according to Thomson Reuters.

“What we saw from the Intel results, and what we’re seeing again from A.M.D. today, doing a bit better than expected, is probably a positive sign about the state of the aggregate PC world,” an analyst at Longbow Research, JoAnne Feeney, said.

On Tuesday, Intel posted better-than-expected results, helping reduce fears that the popularity of Apple’s iPad was cutting into PC sales.

But A.M.D. has less exposure than Intel to corporate customers, making it more sensitive to consumers’ whims.

And while any growth for A.M.D. in netbooks would increase its market share, the segment has low margins compared with more robust notebook and desktop PCs.

A.M.D. is also releasing new chips, code-named Llano, aimed at laptops and desktops that will compete with Intel’s recently introduced Sandy Bridge chips. Both offer integrated graphics processing meant to make additional graphics chips unnecessary.