AMD announced its first quarter earnings today, and, as expected, the company's losses continue to widen. AMD posted a net loss of $0.66 per share, or $416 million, which is worse than the $0.60 per share net loss from the same quarter a year ago.

In its conference call, AMD corroborated Intel's earlier claim that PC demand appears to be bottoming out, and the company attributes the 7 percent sequential increase in net processor revenues to the post-bottom inventory bump I described in my previous report on Intel's earnings. So that's two datapoints indicating that PC demand has stopped cliff diving and may have actually made a real bottom in the first quarter. Let's hope that it's the bottom, and not just a bottom.

As I mentioned above, AMD's microprocessor sales were up a bit from the previous quarter, but they're still down 21 percent year-over-year. The company wants to paint this 7 percent sequential bump as evidence that AMD can still see growth even in a down market, but I think it's also evidence that AMD is still the cheaper alternative to Intel. In other words, the PC market right now is extremely price-sensitive, and AMD's server processors are the bargain alternative.

Revenues for AMD's graphics unit are down 18 percent sequentially and 15 percent year-over-year, which indicates that the demand for graphics products is still contracting.