AMD said to hire JPMorgan Chase to explore its options

Updated Well, that didn't take very long. Reuters reports that chipmaker AMD is doing the old "exploring its options" routine, and has hired investment bankers at JP Morgan Chase to help it do that exploring.

According to the report – which cites the usual "sources familiar with the situation," and in fact says it has three different sources confirming the rumor – AMD is not necessarily seeking to sell itself, but is looking at doing other things, such as licensing or outright peddling its patent portfolio.

AMD had not returned a request for comment from El Reg at press time*, and with a lot of the AMD team at the SC12 supercomputing conference in Salt Lake City, a fast reply is not expected.

Nearly a month ago, when AMD reported its financial results for the third quarter ended in September, the company also announced that it would cut 15 per cent of its workforce. Revenues in the quarter were down 10 per cent to $1.27bn as the PC market slows and tablets slow it down. AMD lost $157m in the quarter and cannot keep bleeding like that.

CEO Rory Read, who was hired to turn the company around, was dealt a very tough hand to play, with Cray all but abandoning AMD's Opterons for its next-generation XC30 supercomputers, and other server makers doing the bare minimum with the Opteron 6200s and now 6300s. Intel's Xeon E5 processors are very tough competition for the Opterons, so you can't blame the server makers if AMD has lost its edge over Chipzilla.

To that end, Read promised that AMD would reset its goals, and focus on the server market – particularly the hyperscale server racket where its SeaMicro machines play well – and system-on-chip designs for embedded devices, industrial machines, communications gear, and tablets.

A week later, AMD was embracing ARM as its savior, licensing 64-bit ARMv8 cores and promising to get an Opteron-branded version of the Cortex-A57 processor into the field by 2014.

There's a lot of time between now and then, and AMD has to do something to generate cash. Selling off some of its patents – or perhaps a chunk or two of its businesses, or the entire company – might be the best option.

With AMD having a market capitalization of $1.42bn as El Reg goes to press, there has never been a better time to buy the company. Particularly for a player like IBM that needs a better x86 and ARM story, or a company such as Oracle that might do it just to be a spoiler.

AMD has lots of options, and after I am done thinking about them a bit, I'll let you know what I've come up with – and you can do likewise. ®

* Update

Soon after we clicked Publish on this story, we received a comment from an AMD spokesman. "AMD's board and management believe that the strategy the company is currently pursuing to drive long-term growth by using AMD's highly-differentiated technology assets is the right approach to enhance shareholder value," he wrote. "AMD is not actively pursuing a sale of the company or significant assets at this time."