ATi is doing horrible financially

[kleinwl]

Large companies can normally survive severial years with large losses. There is always capital investors that believe the story that "with only another xx million, we can turn this around". That is not to say that there will not be any consquences to ATI... just that their survival is not at stake.

I expect, given the rosy picture handed out about the X1000 series to investors, stock prices will slump in 4Q2005 when ATI is unable to show large growth in discrete product. Given availability issues and performance/price issues with the X1000 series, I think a return to 29% margin (current 9% margins) is unrealistic.

However, this will not spell doom for ATI... it just means that they are going to hurt for a while. Maybe that will force them to dump the $10mil in stock bonuses that they are giving their execs.

 

[jasonja]

Originally posted by: 5150Joker

Originally posted by: Corporate Thug
xbox360, intels share of the integrated market. they are ok

No they really aren't ok - not while they are hemorrhaging this kind of money.

Still profitable for the year.. and if you do your homework you'll see that they've had quarters like this one in the past.

 

[Ackmed]

Hey guess what, Ruby Tuesday lost several million from last year too. They arent going anywhere. Just like when NV lost a lot, and was down, they didnt go anywhere. Companies have ups, and they have downs.

 

[ArchAngel777]

For whatever reason, companies can be nearly bankrupt for years before selling off thier assets. Some companies fold a lot faster than others. ATI is loosing money, but they still have plent of life left. No company is flawless, nVidia could flop next time around.

 

[emilyek]

In 2004 ATI made 205 million dollars.

In 2005, 17 million.

One word:

Wow.

No need to wonder why ATI execs were dumping their ATI stock.

 

[ArchAngel777]

Originally posted by: emilyek
In 2004 ATI made 205 million dollars.

In 2005, 17 million.

One word:

Wow.

No need to wonder why ATI execs were dumping their ATI stock.

Is the fiscal year over? I am not sure what the ATI fiscal year is, but is it possible they could end with a profitable 4th quarter? I do not know. But any profit is better than being in the hole. In fact, as long as they can operate with some extra cash at the end of the year is a sign they will be here for a while. We already know they will anyway... ATI is a great company, it simply was beaten this round. nVidia is also another great company.

 

[ponyo]

Oh no! The sky is falling!

 

[BlackPear1]

ATI's year ends in August. I don't know whether ATI or NVidia will perform better from either the technology or business standpoint. But while I'll happily buy either company's products when they suit my needs (I have 3 of each now), you won't catch me buying either stock when there are other companies in the industry (like Intel) whch are much more profitable and have better outlooks.

 

[jiffylube1024]

Originally posted by: Naustica
Oh no! The sky is falling!

It's the fanboy Armageddon!

 

[Insomniak]

They have had one hell of a bad year, yes.

Just looking at their product line can tell you that. They have been behind in availability since last year (still are), behind in performance since the 7800GTX, and just now pulled even in the feature set.

Multiple retapes and product launch delays?

Hell yes they've had a bad year. I'm surprised anyone needed analysts to tell them that.

Despite that, I doubt ATi is going anywhere soon. One bad run will not disqualify you from the game.

 

[WhipperSnapper]

Originally posted by: 5150Joker

I'm not happy at all, actually a bit worried for them and the industry as a whole. I don't want them to fall so far behind nVidia financially that they can no longer afford the engineering talent to compete in the high end.

My thoughts exactly. Video card prices are high enough already, often outstripping the price of a decent mobo + cpu. We already have a two-firm oligopoly in the high-end and mid-range market. The last thing we need is a monopoly.

 

[Creig]

People seem to forget that the money ATI has been dumping into the XBox 360, R520/R580 and Crossfire is an investment. And now those investments are about to start paying off.

ATI is just fine.

 

[ScrewFace]

You all must realize something: remember when AT's GPUs were absolute garbage for 3D gaming (3D xPression 2MB, Rage Pro, crummy drivers)? ATI didn't go out of business then and it won't now with GPUs that are actually useful for 3D gaming and compete well with nVidia and make (finally) excellent drivers on par with nVidia's.

 

[nRollo]

Originally posted by: Creig
People seem to forget that the money ATI has been dumping into the XBox 360, R520/R580 and Crossfire is an investment. And now those investments are about to start paying off.

ATI is just fine.

I guess that depends on your definition of "fine"?

They're struggling as far as I can tell:
1. Paper launched new line of cards.
2. Paper launched Crossfire three times.
3. Flip flopped on price of Crossfire parts twice.
4. Have a multitude of pending lawsuits.
5. Big quarterly losses, low average cost per unit


On top of that, when you consider an R420 is really all you can buy from them on 10/7/2005, I don't think we can even come close to saying "ATI is fine"? They have a pretty big hole to dig out of, and handing out 50 cards to the press isn't going to put them in "Fine" condition.

They need widespread availability of their new higher end parts at a price people will pay for them and to recover some of the higher end market they've lost/raise average cost per unit before they'll be "fine".

Right now they're treading water. On the bright side, their new line looks promising, so if they get some decent yield they can start the journey back to "fine".

 

[gsellis]

Originally posted by: 5150Joker

Originally posted by: gsellis
You know.... Working for a company that is in bankruptcy and lost about $5B (yes, billion) over the last 5 years, I have to laugh reading this stuff.

:laugh:

Well I guess that tells us a lot about your company and the quality of it's employees. :roll:

Well we did not have your brillant advice on the future price of oil, the cost of too much supply, the cost of other competitors protected by bankrupctcy, and the shock effects of terrorism on the market to guide us. Maybe next time.

 

[malG]

Originally posted by: Corporate Thug
i think 360 and the integrated market will stop the hemorrhaging

Ironically NVIDIA loves the XBOX 360 too because they're getting free money from licensing NVIDIA's technology. I hope XBOX 360 does well

 

[ArchAngel777]

Originally posted by: Creig
People seem to forget that the money ATI has been dumping into the XBox 360, R520/R580 and Crossfire is an investment. And now those investments are about to start paying off.

ATI is just fine.

Hmmm, not quite sure how you were able to put a huge spin on that... Anyway, time will tell... We can take a look at their next fiscal year to find out if what you say is true... It should exceed the fiscal year of 2004 if what you imply is true. Beating the craptastic fiscal year of 2005 will mean nothing except that those investments are still not "paying" off.

 

[apoppin]

Learn something . . . even the Inq has it right compare to most of you guys: :Q

ATI turns in fourth quarter loss

ATI (tick: ATYT) confirmed guidance it gave some weeks back and said its fourth quarter revenues fell by $60 million to $470 million because of lower sales in the PC segment.

This segment accounted for around 80 per cent of its quarterly revenues, the firm said.

It said the main reason for the fall was lower sales sales of performance and enthusias desktop products in the add in board and retail channels.

But the decline was partially offset by better sales of desktop integrated products, ATI said.

It declared a $67 million write down in inventory for the period, and turned in a net loss of $104 million on the turnover of $470 million. Without the writedown and other sundries, the net loss amounted to $29 million.

For the financial year 2005, ATI declared a net profit of $17 million. But David Orton, the firm's CEO, said it's entering its financial 2006 year with new products and focusing on operational and financial performance. He said its new products and programmes position it well for the future

they have a pretty good future

edit VERY WELL:

ATI strikes deal with Intel, delivers Xpress 200 IGP for Intel boards

Horribly?
:Q

i think NOT
:thumbsdown:

 

[ArchAngel777]

Originally posted by: apoppin
Kearn something . . . even the Inq has it right compare to most of you guys: :Q

ATI turns in fourth quarter loss

ATI (tick: ATYT) confirmed guidance it gave some weeks back and said its fourth quarter revenues fell by $60 million to $470 million because of lower sales in the PC segment.

This segment accounted for around 80 per cent of its quarterly revenues, the firm said.

It said the main reason for the fall was lower sales sales of performance and enthusias desktop products in the add in board and retail channels.

But the decline was partially offset by better sales of desktop integrated products, ATI said.

It declared a $67 million write down in inventory for the period, and turned in a net loss of $104 million on the turnover of $470 million. Without the writedown and other sundries, the net loss amounted to $29 million.

For the financial year 2005, ATI declared a net profit of $17 million. But David Orton, the firm's CEO, said it's entering its financial 2006 year with new products and focusing on operational and financial performance. He said its new products and programmes position it well for the future

they have a pretty good future

edit VERY WELL:

ATI strikes deal with Intel, delivers Xpress 200 IGP for Intel boards

I kearned that alright

 

[apoppin]

Originally posted by: ArchAngel777

Originally posted by: apoppin
Learn something . . . even the Inq has it right compare to most of you guys: :Q

ATI turns in fourth quarter loss

ATI (tick: ATYT) confirmed guidance it gave some weeks back and said its fourth quarter revenues fell by $60 million to $470 million because of lower sales in the PC segment.

This segment accounted for around 80 per cent of its quarterly revenues, the firm said.

It said the main reason for the fall was lower sales sales of performance and enthusias desktop products in the add in board and retail channels.

But the decline was partially offset by better sales of desktop integrated products, ATI said.

It declared a $67 million write down in inventory for the period, and turned in a net loss of $104 million on the turnover of $470 million. Without the writedown and other sundries, the net loss amounted to $29 million.

For the financial year 2005, ATI declared a net profit of $17 million. But David Orton, the firm's CEO, said it's entering its financial 2006 year with new products and focusing on operational and financial performance. He said its new products and programmes position it well for the future

they have a pretty good future

edit VERY WELL:

ATI strikes deal with Intel, delivers Xpress 200 IGP for Intel boards

I kearned that alright

goof for you!

edited

:laugh:

 

[Creig]

Originally posted by: ArchAngel777
Hmmm, not quite sure how you were able to put a huge spin on that...

It's quite simple. All the money ATI has spent moving their product line to the .90 nm line, the XBox360 design, the R520 design, Crossfire system, Avivo, and new versions of the Theater and Xilleon chipsets hasn't earned them a single cent up until now. That's a LOT of new hardware. In fact, I'm sure it has cost them many millions of dollars to design all that which also cuts into profits earned from current sales. As soon as all these new products hit the retail shelves ATI will start earning a profit from them.

How is that spin?

 

[remagavon]

Originally posted by: Genx87

Originally posted by: Rollo

Originally posted by: Corporate Thug
i think 360 and the integrated market will stop the hemorrhaging

Don't they have a different kind of deal, less lucrative, than nV had with the Xbox?

Integrated chips are giveaways, too low of average cost per unit.

I think their fortunes ride on bringing their R520 parts to market in quantity and at a price appropriate to their performance level.

Not sure if it is less lucrative but certainly sounds like it has less risk. ATI is licensing them the design and get a royalty off each chip produced. Basically ATI did the design and testing and microsoft foots the bill for manufacturing. Nvidia's issue with Microsoft sounded like they went on a sliding scale for part pricing. Meaning if Microsoft bought x amount of chips Nvidia gets paid this. Where with each benchmark Nvidia recieved less and less money from Microsoft. The problem is the xBox pretty much flopped outside of the US market and Microsoft wanted to accelerate the sliding scale and start paying Nvidia less money than the contract stipulated. Nvidia refused and it was settled by the courts which I believe granted Nvidia full part price.

Yep. The 360 is probably going to sell more than the Xbox did as well, so that'll help out things that are already going to go very well for ATi. They have basically no costs from this point on and will be reaping the benefits this time next year. They're in for a pretty dismal situation however, in the short-term anyway.

 

[SickBeast]

Originally posted by: Rollo

Originally posted by: Creig
People seem to forget that the money ATI has been dumping into the XBox 360, R520/R580 and Crossfire is an investment. And now those investments are about to start paying off.

ATI is just fine.

I guess that depends on your definition of "fine"?

They're struggling as far as I can tell:
1. Paper launched new line of cards.
2. Paper launched Crossfire three times.
3. Flip flopped on price of Crossfire parts twice.
4. Have a multitude of pending lawsuits.
5. Big quarterly losses, low average cost per unit


On top of that, when you consider an R420 is really all you can buy from them on 10/7/2005, I don't think we can even come close to saying "ATI is fine"? They have a pretty big hole to dig out of, and handing out 50 cards to the press isn't going to put them in "Fine" condition.

They need widespread availability of their new higher end parts at a price people will pay for them and to recover some of the higher end market they've lost/raise average cost per unit before they'll be "fine".

Right now they're treading water. On the bright side, their new line looks promising, so if they get some decent yield they can start the journey back to "fine".

Honestly, the worst I see happening from the legal stuff is a bunch of rich executives being thrown in jail. They can always be replaced.

When Enron went down, did they get sued? IMO, the executives should be sued personally, not ATI as a whole, and they should pay the money they lose out of pocket. Only seems fair.

As for the paper launch, cards are supposedly in the stores as of Monday, how many is still unknown, but still, not terrible.

I think you're blowing things out of proportion Rollo. ATI will have a big year in 2006. If R580 comes out before the end of the year I predict very good things for ATI in the coming months.