AMD Q3 results: even worse than revised expectations

[ViRGE]

Edit to add:



http://semiaccurate.com/2012/10/12/amds-layoffs-target-engineering/

Aww crap.

Generally speaking I trust Charlie about as far as I can throw him. But when it comes to AMD matters he's usually right.:|

 

[3DVagabond]

Keep your head in the sand......it is comforting in there!

I could say to you to keep your head in the clouds. Of course that would add nothing to the discussion, just as you have done.

Read the quote. I even bolded all of the products. Which were all CPU/APU models. Somehow that turned into AMD having 100mil worth of old 6000 series GPU's lying around that had to be liquidated.

 

[-Slacker-]

If you don't think AMD is in some serious Jelly, I'd like to know why.

I doubt it.

 

[KompuKare]

I very much admire JHH. He has a good vision for the company and is excellent at managing it overall (bumpgate notwithstanding).

Well, I actually can't stand the guy because he comes across as arrogant but I would take the opposite line on bumpgate: after the mistake was made for Nvidia shareholders and their pile of cash in the bank, JHH did really well there (then he is a major shareholder). For costumers the defect fiasco was handled badly but aside from a few people like myself who blame NV for the defects, most costumers blame the OEM (mainly HP I'd say) so as far as JHH is concerned they mostly got away with that one and only had to shell out $250 million for a $500-$1000 million problem...

 

[Keysplayr]

I doubt it.

You....... doubt it. K.
That's what I thought. Apparently you actually do think they're in trouble, which is a proper response for the situation.

 

[beginner99]

"Earlier this year, Forrester predicted that tablets would overtake PC laptops by 2016. Microsoft believes tablets will outsell Desktop PCs by as early as next year." ~ TechSpot

of course. because the hardware they contain is already out-dated when released. This is like ti was with PCs not too long ago...

I'm writing this on almost 3 year old tech that can still play modern games like BF3.

 

[sontin]

Not to mention we know AMD's discrete GPU division gained market share last quarter. If you gained market share that means your inventory was selling, not sitting idle. That's another sign that it's not desktop graphics that's the problem here.

Wrong, wrong, wrong.

They gained in the discrete desktop market because nVidia stopped shipment of nearly all 40nm products. In the end they lost share in the overall discrete business.

 

[SirPauly]

Do you think AMD's GPU division made more cash flows during HD4000-6000 days?

At times? Absolutely!

 

[Siberian]

Meaning? Nvidia could have had a faster GPU right now, but they chose not to? Why would they do that?

Sounds like a pure desperation move.

They are selling what would have been a $300 for $500. Releasing a bigger and faster chip would cost them more money and they would not be able to get a whole lot more for it. Instead they use that chip in the pro market where they can get thousands for it.

To sum up a smaller chip = greater profit.

 

[BenSkywalker]

Is the GPU division of AMD profitable?

It has been, rather better on a proportional basis then the CPU division since AMD acquired them.

Is the GPU division losing AMD a *ton* of money?

Yes, in massive fashion. $240 Million profit per year required to handle the interest on the cost to acquire ATi- that pays off *none* of the acquisition cost. If the GPU division was making AMD $1Billion in profit per year, which is *far* beyond what they have hit, it would still be another year or two before it paid for itself. There are many creative ways to move money around to change how it is looked at, but if AMD had taken the cash they used to acquire ATi into CDs it would be returning significantly *more* money then their GPU division is right now.

The fact that there is a sector of the company that in isolation is producing profits doesn't mean it has been good for the company. The reality is that the ATi acquisition has been utterly catastrophic to AMD's bottom line.

That doesn't mean the ATi division has done anything wrong at all, flawless execution wouldn't have changed things much. AMD paid *way* too much money for them, which was shockingly obvious at the time, and then took the most valuable asset they had on a long term basis- SnapDragon- and sold it off for $65 Million dollars. If that number had $650 Million dollars it still would have been incredibly stupid for AMD to do, just to put it in perspective(the SnapDragon tech was actually an ATi property, not AMD's).

From a technology basis, ATi had everything they needed to have a market cap and forward growth in direct lock step with nVidia. Instead, they end up facing massive layoffs and a shaky future because of the inept morons that helm AMD.

I for one think paying a good CEO tens of millions of dollars is money well spent. Look to AMD for an example of what happens when you put idiots in charge of billions of dollars. No matter how good your engineering is, it can't hope to overcome inept morons running the business side of things

 

[SirPauly]

ATI was showing consumer growth potential, impressive margins, with their mobile hand held -- Imageon , DTV --Xilleon and Chip-sets! Very vocal about GPU Processing and even GPU Physics -- mirrored nVidia. They were hitting record territories with over-all revenue and profits.

Whatever ATI was -- is no longer, to me.

 

[ShintaiDK]

Is the GPU division of AMD profitable?

They mainly tend to swing around 0 with a little profit in the overall picture. Something completely unacceptable when compared to nVidia. And even worse compared to the purchase cost.

 

[NIGELG]

They are selling what would have been a $300 for $500.

And yet you guys lap up these cards thinking that??LOL

A free 200 bucks from their loyalists??

 

[AnandThenMan]

ATI was showing consumer growth potential, impressive margins, with their mobile hand held -- Imageon , DTV --Xilleon and Chip-sets! Very vocal about GPU Processing and even GPU Physics -- mirrored nVidia. They were hitting record territories with over-all revenue and profits.

The 2900XT was a resounding success, ATI was taking marketshare from Nvidia hand over fist, once AMD got a hold of them it has been all downhill ever since.

 

[boxleitnerb]

The 2900XT was a success? In what universe? It was slow, hot and expensive to make.

 

[Jaydip]

I think he was being sarcastic

 

[boxleitnerb]

Now I see it...duh

 

[blastingcap]

They mainly tend to swing around 0 with a little profit in the overall picture. Something completely unacceptable when compared to nVidia. And even worse compared to the purchase cost.

Yeah but ATI the standalone company was in a much better position than the current AMD. AMD was even stupid enough to force the removal of ATI labels in favor of the damaged-goods branding of AMD, long known as Intel's whipping boy. Get your facts straight, ATI was a decently strong no. 2 in its fight vs NV, unlike AMD's weak no. 2 vs. Intel. AMD's crushing debt load brought on by the ATI acquisition, inept management, selling Snapdragon, etc. are what is crushing it today.

 

[Keysplayr]

If AMD survives this, then it just screams that you can have the worst management, making the worst possible decisions for years and still live. I just don't see that happening without any sort of last minute savings buyout or something along those lines. Rory Read may just be a vulture capitalist and is making somebody else millions on the failing of AMD.
They'll settle up later I guess.

 

[NIGELG]

If AMD survives this, then it just screams that you can have the worst management, making the worst possible decisions for years and still live. I just don't see that happening without any sort of last minute savings buyout or something along those lines. Rory Read may just be a vulture capitalist and is making somebody else millions on the failing of AMD.
They'll settle up later I guess.

Yeah they should have left ATi to some other buyer.They killed the brand.I wish someone buys back ATi and let AMD fight on without it.They might do good without it like in the Athlon days.

 

[SirPauly]

The 2900XT was a resounding success, ATI was taking marketshare from Nvidia hand over fist, once AMD got a hold of them it has been all downhill ever since.

At the time of the announcement, which was July of 2006. The 2900XT was released when?

 

[Siberian]

And yet you guys lap up these cards thinking that??LOL

A free 200 bucks from their loyalists??

It was better and cheaper than the 7970. So it was the other "loyalists" that really got the short end of the stick.

 

[NIGELG]

It was better and cheaper than the 7970. So it was the other "loyalists" that really got the short end of the stick.

Let's get it straight.7970 and 680 are both the highest end single card solutions from AMD and Nvidia.680 is no 'mid range' card which beats AMD'S 'high end' card.

As for better and cheaper that's just your green view.There are many happy 7970 owners out there.

If you payed 500 bucks for a 300 dollar mid range card then you got the crappy end of the stick.

 

[Ajay]

Yeah but ATI the standalone company was in a much better position than the current AMD. AMD was even stupid enough to force the removal of ATI labels in favor of the damaged-goods branding of AMD, long known as Intel's whipping boy. Get your facts straight, ATI was a decently strong no. 2 in its fight vs NV, unlike AMD's weak no. 2 vs. Intel. AMD's crushing debt load brought on by the ATI acquisition, inept management, selling Snapdragon, etc. are what is crushing it today.

Yeah, but can you see any company out there actually buying AMD's graphics division (ATI)? I don't, unless it's a steal.

 

[Remobz]

I feel worried as well