AMD Pre-announces miss of Q1 Revenue
- Thread starter Phynaz
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Regs
Lifer
- Aug 9, 2002
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At least there is some good news even though with the gained market share they won't get nothing for it.
All we have to say is AMD missed their oppurtunity after 4-5 years of virtually no competition from Intel. If you're up against a giant there will be only so many chances where you can sit and leech.
I still don't see it as being good, even if it did gain market share. Market share is irrelevant if you don't freaking make any money from that gain. You can gain market share by giving away chips for dirt cheap and at loss. You can still go BK even if you have 80% market share. Investors wanna see the moola, the money maker, gains, profits......
For AMD to fall on "oh we have 25% market share" is pathetic and weak especially when you're still reducing target revenue with increased market.
For AMD to fall on "oh we have 25% market share" is pathetic and weak especially when you're still reducing target revenue with increased market.
I want to hear the conference which was held at 10:30am this morning, (1:30pm eastern time) and it's 2:30pm now.
Here is the actual Technology Conference
But when I open it it says "The stream you have requested i currently unavailable..."
This MSN Money article states that it won't be avialable until 1 hour after the conference is finished.
Here is the actual Technology Conference
But when I open it it says "The stream you have requested i currently unavailable..."
This MSN Money article states that it won't be avialable until 1 hour after the conference is finished.
After lying through their teeth to analysts in Q4, did anyone still believe AMD's guidance of $1.7B for Q1?
At least Ruiz confirmed in the cc Barcelona samples and products would ship by end of summer, which means September?
At least Ruiz confirmed in the cc Barcelona samples and products would ship by end of summer, which means September?
AMD's current losses aren't too much worry, it's the big picture you have to see. Until AMD's success with their K8 architecture, the average consumer only knew Intel and assumed that AMD meant lower quality. Over the past several years AMD has drastically expanded their brand awareness so that even though they may not be on top at the moment, they need a stopgap until they can release their own next generation architecture. It's after the Barcelona release the the fiscal numbers become more relevant.
AMD isnt worth nearly as much as Intel. In fact AMD has a huge debt on it's back in the form of ATI.
They cant afford to bleed money over an extended period of time like Intel did.
They cant afford to bleed money over an extended period of time like Intel did.
Ok the only interesting keypoints from the conference that I got were that this quarter AMD will have finished their last upgrade from 200mm to 300mm waffer in all their fabs.
And the other thing they said was that in order for AMD to maintain profitability it needs to have +30% of the marketshare which is what they consider to "break the monopoly". If they are at 24%-ish currently (correct?), then how likely is is that Barcelona and derivatives (Kuma, Spica, Agena...) will bring AMD to that +30% by 2008?
Allowing 1-2 years for an introduction of a new products to have an effect.
And the other thing they said was that in order for AMD to maintain profitability it needs to have +30% of the marketshare which is what they consider to "break the monopoly". If they are at 24%-ish currently (correct?), then how likely is is that Barcelona and derivatives (Kuma, Spica, Agena...) will bring AMD to that +30% by 2008?
Allowing 1-2 years for an introduction of a new products to have an effect.
30% MSS is heavily dependent on Barcelona's performance.
With four 45nm fabs coming online, Intel is clearly going to price quad-core parts at dual-core prices. AMD's not going to be able to hang on to the price lever any longer in 2008.
With four 45nm fabs coming online, Intel is clearly going to price quad-core parts at dual-core prices. AMD's not going to be able to hang on to the price lever any longer in 2008.
Barcelona competes in an entirely different market, which is 2P+ Server processors so it will be going against Clovertown and it's 45nm equivalent Harpertown as well as Tigerton.
It's possible Intel could leverage their manufacturing capacity as a hammer, as the MCM 45nm Quad Core is going to have total equivalent die size meaning 2 dies equaling the older Smithfield processor and we know how cheap Intel sold that for at some point when it needed to.
Of course they will get something...they have gained a huge number of places where they can sell their product. The problem is that you are thinking very short term...
1. AMD's opportunity has only been since ~Sept 05...prior to that, Intel's marketing practices (which they stopped immediately after the lawsuit was filed) prevented them from entering the majority of markets/OEMs.
2. Once AMD had a free hand, their marketshare and profits rose at a frenetic pace (hence the $42/share price in Jan 06) until Intel began the price war and released C2D.
Remember that Intel had similar pain...their Net Income dropped from $8.6 Billion in 05 to $5.0 Billion in 06. That's a 41% drop YoY!!!
3. AMD has also gained many other very valuable things over the last few years...they have tripled their production capacity (this year they can now manufacture over 100 Million chips/year, or almost 50% of all chips), they have a whole new architecture being released in a matter of months, they have opened up contracts and development deals with every major OEM, they've acquired the capacity to build an entire platform in-house, they've introduced a new open platform (which is already gaining traction) called Torrenza, they've begun work on a new type of CPU (system on a chip) called Fusion (which Intel failed to build with Timna).
The bottom line is that AMD is still in the best position they have ever been in during their history...
For the short term (the next 2 quarters), you will probably see AMD at the lowest share price it will ever be at again.
For those of you who are AMD fans, there is no way that Intel is ever going away (at least not in our lifetimes)...so you can put that thought right out of your heads.
For those of you who are Intel fans, the opposite is true as well...in fact, if you are thinking that AMD will ever go back to it's place as an "also ran" company, you are severely deluding yourselves.
What we are witnessing is the death of a monopoly and the birth of a true duopoly...
No, he said the major revenue for Barcelona would be accounted for at the end of the summer.
There has been no slippage on shipping...
Sigh...
You need to actually listen to what he said.
AMD screwed up in their dealings with both the OEMs and the channel.
Remember that the problems in distribution began as their larger shipments to Dell began...it seems that AMD is experiencing a steep learning curve in dealing with the demands and ordering practices of OEMs (welcome to the NFL!).
They pulled back on channel shipments in order to maintain inventory for expected OEM shipments, but then the OEMs changed their mind. Keep in mind that with those contracts, there are severe penalties for not having inventory at hand when Dell comes knocking, but Dell can change their minds at the last minute...
So he didn't lie, he got suckered...
I beleive that was "long term" profitability...in other words profitability over the next decade.
They are currently at 25%, and they gained marketshare in Jan but lost it in Feb...
Over the short term (Q1, Q2 and possibly Q3), it's going to be ugly for AMD.
As to their short term cash situation, they are slightly diluting their shares with a bond offering to cover it.
Schedule 14a document
Enormous debt
Both AMDs CPU and GPU markets are taking large losses.
R600 delayed until may... next quarter will be bad too.
R600 VS G81 in the summer may not bode well either.
AMD has been here before, but not with $10b in debt.
Both AMDs CPU and GPU markets are taking large losses.
R600 delayed until may... next quarter will be bad too.
R600 VS G81 in the summer may not bode well either.
AMD has been here before, but not with $10b in debt.
Don't think so...for instance, when Fab 30 was built, they leveraged the entire company on the outcome.
Their current stockholder equity is $5.785 Billion (Dec 31 2006) as opposed to $3.352 Billion the year before (please note that this is total equity, not just assets), so I would suggest that your contention is incorrect.
And the 50% dilution is wrong...they are proposing doubling the number of shares, but that doesn't mean that the shares get cut in half. Usually (and this will be explained at the shareholders meeting) a significant number of those shares get passed on to current shareholders, but a portion is offered to the public in order to raise cash.
Nemesis 1
Lifer
- Dec 30, 2006
- 11,366
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Heres a quote from todays conferance call .
Of course, AMD's quad-core processor came up briefly during an interview-style conversation on the Morgan Stanley stage and Ruiz provided some information bits, most of what was known before, such as the expectation that the chip would outperform its predecessors by about 30 to 40% and that AMD considers the introduction of the chip as a significant launch, probably more significant than the launch of the original Opteron CPU. When it came to likely availability, Ruiz said AMD is on track to sample the "Barcelona" server quad-core CPU and will be shipping in "late summer" - which is a more detailed timeframe than the "mid-2007" or "H2 2007" we had heard in the past.
Barcelona" server quad-core CPU and will be shipping in "late summer" - which is a more detailed timeframe than the "mid-2007" or "H2 2007" we had heard in the past
I see clearly what AMD said. K10 beginns sampling server chips at the end of summer.
Now either get a link to back up your statement or quite spreading FUD.MAN you spread more AMD fud than anyone on the net.
1. That is not a quote from the conference call, it's a reporter's notes Sir FUD (do you actually know what FUD means?)...
2. Conference call audio
I have read the 14a document, and it says nothing about distribution either way...
Ummm...Accounting 101 here. It also includes the debt and expenditures used to buy ATI, which balances that out. You are counting assets and not liabilities...the equity counts both.
All it takes for AMD to tank is for their credit to be pulled.
They are bleeding money like water through a seive, they need to turn a profit, not just retake the performance crown.
They are bleeding money like water through a seive, they need to turn a profit, not just retake the performance crown.
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