AMD did better than people thought it would in Q2. Even so it barely looks like number two in a two-horse race.

Revenues were up 40% year-over-year to a record $1.65 billion when it was expected to come in with $1.55 billion and it would have earned 11 cents a share, better than the six cents forecast, were it not for write-offs connected with the spin-off of its factories.

In reality it lost six cents or $43 million, which is a drop in the bucket compared to previous losses. This time last year it lost $330 million.

Its operating income this time was $125 million and its gross margin 45%, roughly 20 points below Intel's but healthy for AMD.

In a canned statement, CEO Dirk Meyer said customers launched a record number of new mobile and desktop platforms.

Processors revenue increased 4% sequentially and 31% percent year-over-year primarily from notebooks. ASPs increased a little. Operating income was $128 million compared with $146 million in Q1 and an operating loss of $67 million in Q2 last year.

Graphics revenue were up 8% sequentially and 87% year-over-year. It said the sequential increase was driven by record GPU unit shipments, partially offset by a decrease in ASP. The year-over-year increase was driven by an increase in GPU shipments and ASP. The sector's operating income was $33 million, compared with $47 million in Q1 and a loss of $17 million last year.

By way of guidance AMD said it expects revenue to be up seasonally in the third quarter, which means it expects to be up 5%-10% over Q2 or somewhere between $1.73 billion and $1.81 billion.

It also going to push out the fused MPU-GPU chip Ontario in Q4 earlier than anticipated.

It's got a flat quarter-over-quarter $1.9 billion in the bank. It now owns only 28% of Globalfoundries.