Question Just saw that AMD announced that shipments dropped about 16% - will prices drop?

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IntelUser2000

Elite Member
Oct 14, 2003
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Your idea of "responsible spending" and interest rates being good belongs back in the 1940's where it didn't work last time. The fix is to get the stock market back to reality.
What are you talking about? We're now in the 21st century so all fundamentals matter jack?

No, if vast majority of the people didn't have massive amount of mortgages and credit card debt and all kinds of debt, and have money saved up in savings accounts, yes the "GDP growth" would have been lower but the economy as a whole would have been much more resilient.

In the previous quarter, they said client shipments were down 8% but ASPs were up 35%. It's like the ASP suddenly went flat.
ASPs up by 35% - 1.35x

They said revenues declined by 40%. Tell me that I'm misunderstanding you and you know basic math? 40% decline in revenue means ASPs need to increase by 67% to make up for it. 35% increase is piddy compared to 40% decline.

1.67x/1.35 = Even if ASPs went flat in Q3, you still need to account for 24%. So both volume and ASPs tanked.
 
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DisEnchantment

Golden Member
Mar 3, 2017
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Nah, it's doom prophet cuz it turns out doom. :smilingimp:
Well it seems to be more apt because we are heading towards Armageddon, financially and otherwise.

Good thing that might come of this is that your DIY transparent loop will have inbuilt Illumination without needing radium coatings.
No RGB needed, glows without power. Only small problem is that nobody might be there on social media anymore to like your content.
 

itsmydamnation

Platinum Member
Feb 6, 2011
2,459
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No, if vast majority of the people didn't have massive amount of mortgages and credit card debt and all kinds of debt, and have money saved up in savings accounts, yes the "GDP growth" would have been lower but the economy as a whole would have been much more resilient.
in counties like Australia we have lending standards, so nowhere near that kind of issue , still have ~ 40% yoy inflation with ~ 50% yoy company profits.
What did we do during COVID, we handed out massive amounts of money to corporates so they didn't lay people off. lots of those corporates didn't need it as work force transitioned to WFH and they made massive profits ( my company was one of them).

debt is what has fueled growth for all of modern history , money in bank accounts earning interest does little for an economy. slow inflation keeps debt under control as it slowly inflates away. central banks have like two tools bond manipulation and interest rates , they are pulling the only leavers they have despite inflation not being driven by demand.
 

moinmoin

Diamond Member
Jun 1, 2017
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Primary source:

The biggest take away is that with the launch of Zen 4, AM5 as well as the continuing releases of Rembrandt laptops AMD still expected growth in the client business which failed to materialize. What I don't really understand is how AMD couldn't see that coming. I would have expected business contacts, sales and pre-orders to happen over a long enough time to have been possible to prepare for this by the time this quarter's projections were last published, so AMD having to reduce them this much is a clear disappointment.
 

Harry_Wild

Senior member
Dec 14, 2012
810
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I'm assuming that Intel and other system manufacturers are also seeing a similar slowdown of around 16% to 20% compared to what was expected.

Do you think this will lead to price drops?
Hard to say! The chip and related OEM companies want to prevent the double wammo- sales and profit drop at the same time! In the U.S. employment is still raising and so is spending! It is the holiday season rolling around too! Will be interesting to see what happens to computer sales! Big companies are cutting their spending and hiring. It is the midsize and small businesses that ramping up hiring and spending.
 
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dnavas

Senior member
Feb 25, 2017
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I would have thought it was too early for price drops considering that B motherboards are still in the wings, motherboard prices in general should drop once they're not air-shipped, and the competition is still in line. There are simply too many reasons to wait right now.
That said, the move at Microcenter seems to indicate that AMD felt, nevertheless, that some market experimentation was in order. That tells me things could be pretty grim....
 

jpiniero

Lifer
Oct 1, 2010
12,843
4,127
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The biggest take away is that with the launch of Zen 4, AM5 as well as the continuing releases of Rembrandt laptops AMD still expected growth in the client business which failed to materialize. What I don't really understand is how AMD couldn't see that coming. I would have expected business contacts, sales and pre-orders to happen over a long enough time to have been possible to prepare for this by the time this quarter's projections were last published, so AMD having to reduce them this much is a clear disappointment.
As I mentioned, shipments were down 8% in Q2 and in Q1 they were down 7% (which includes the Graphics business). So a decline in volume shouldn't have been a surprise.
 
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Hitman928

Diamond Member
Apr 15, 2012
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I expected a rough quarter or two at least for AMD given Nvidia and Intel's guidance but this is significantly worse than I expected. Mostly because AMD over the past few years has been so accurate with their forecasts (and even tended to err on the conservative side). Lisa Su's comments on their financials and forward looking projections will be very interesting. Intel already guided pretty low for Q3, hopefully this isn't an indication that even their low guidance wasn't low enough. Nvidia commented that they expected their bad quarter to be very temporary but I don't think that will turn out to be accurate either.
 

dullard

Elite Member
May 21, 2001
24,336
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Part of trouble ahead in the semiconductor industry is a looming ban on selling chips to China. AMD is one company that will be impacted (server chip sales banned).

 

maddie

Diamond Member
Jul 18, 2010
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I expected a rough quarter or two at least for AMD given Nvidia and Intel's guidance but this is significantly worse than I expected. Mostly because AMD over the past few years has been so accurate with their forecasts (and even tended to err on the conservative side). Lisa Su's comments on their financials and forward looking projections will be very interesting. Intel already guided pretty low for Q3, hopefully this isn't an indication that even their low guidance wasn't low enough. Nvidia commented that they expected their bad quarter to be very temporary but I don't think that will turn out to be accurate either.
At the risk of cementing my new doom handle, check out Fedex's 2nd sly "pre-announcement" in 2 weeks. When last have we seen this? Plan accordingly, a perfect storm indeed that will last longer than expected. More clarity by Oct 21?



"But AMD wasn't the only one to indicate that the bottom fell off the global economy in September: moments ago Fedex stock also plunged after Reuters reported that the division of the global logistics and freight giant that handles most of the company's e-commerce deliveries plans to lower volume forecasts because its customers plan to ship fewer holiday packages, according to an internal memo obtained by Reuters.

"We expect there to be downward adjustments to volume forecasts," Paul Melander, a FedEx Ground senior vice president said in a message to the unit's delivery contractors earlier this week. The new forecasts will be available on or about Oct. 21.

"These changes will reflect the latest information from customers about how they anticipate current conditions are likely to decrease their volumes this holiday season," Melander said, confirming what we all know: in September, the global economy has hit a brick wall, and the fall out is just starting to be felt.

FedEx leaked a preannouncement in the form of an internal memo, which it knew would be immediately leaked to the media, to warn the market of what is coming. There was another reason: the last thing FedEx wanted was to humiliate itself with a second public preannouncement in just two weeks, following the company's shocking preannouncement from Sept 15
"
 

trivik12

Member
Jan 26, 2006
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AMD is getting hammered today. Now its down more than 13%. Post market drop yesterday looked soft but today there is greater market selloff due to strong jobs report and AMD is just pummeled along with its bad news. if we have prolonged recession which looks probable with Fed continuing to be aggressive with rate hikes(now we are expecting another 1.25% for just this year and further hikes next year), I am not sure when we will bottom.

Long term this drops are opportunities for sure.
 
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Saylick

Platinum Member
Sep 10, 2012
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AMD is getting hammered today. Now its down more than 13%. Post market drop yesterday looked soft but today there is greater market selloff due to strong jobs report and AMD is just pummeled along with its bad news. if we have prolonged recession which looks probable with Fed continuing to be aggressive with rate hikes(now we are expecting another 1.25% for just this year and further hikes next year), I am not sure when we will bottom.

Long term this drops are opportunities for sure.
Too bad I used up a significant portion of my dry powder when AMD was around the low 70s... It's kind of crazy to see it under $60 per share.
 

Abwx

Diamond Member
Apr 2, 2011
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According to Computerbase OEM/ODM have something like up to 180 days of sales in inventory, just Asus is sitting on 6.9bn $ worth of inventories, guess that what was prevently built and stockpiled during shortages days is now hard to digest given the rapidly slumping economies all around the world...

 

maddie

Diamond Member
Jul 18, 2010
4,440
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According to Computerbase OEM/ODM have something like up to 180 days of sales in inventory, just Asus is sitting on 6.9bn $ worth of inventories, guess that what was prevently built and stockpiled during shortages days is now hard to digest given the rapidly slumping economies all around the world...

I find this hard to believe. Could they have misheard? 1/2 yr sales with said sales still dropping. If true so much for predictions of prices not dropping.
 

maddie

Diamond Member
Jul 18, 2010
4,440
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AMD is getting hammered today. Now its down more than 13%. Post market drop yesterday looked soft but today there is greater market selloff due to strong jobs report and AMD is just pummeled along with its bad news. if we have prolonged recession which looks probable with Fed continuing to be aggressive with rate hikes(now we are expecting another 1.25% for just this year and further hikes next year), I am not sure when we will bottom.

Long term this drops are opportunities for sure.
AMD should be by far the best positioned to ride out this period.
 
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maddie

Diamond Member
Jul 18, 2010
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I would think companies with the most cash on hand would be better positioned in the event of an economic slowdown.
Sales don't stop completely, it goes to the best suited for the new cost conscious conditions.

Flexibility in product stacks and costs of manufacture. Can repurpose chiplets for client or server. Many separate markets for 6nm designs to absorb wafers (console, mobile APUs, IO chiplets). Performance/area approach to RDNA3. Lower power advantages. I see them having cost advantages across all lines. They will have to sacrifice margins but then everyone will be doing the same anyhow.
 

13Gigatons

Diamond Member
Apr 19, 2005
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Lots of bad things working against tech right now: inflation, recession, high prices, last gen being good enough, covid spike ending, miners, etc.

5000+Mobo+DDR4 is finally priced right.
 
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Abwx

Diamond Member
Apr 2, 2011
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I find this hard to believe. Could they have misheard? 1/2 yr sales with said sales still dropping. If true so much for predictions of prices not dropping.
That seems to be right, according to Asus the whole market contracted by -6%/Q1 and -15%/Q2 and they projected another -15% for Q3, that s -32% aggregated at the end of Q3, and that could be worse since the latter number is an estimation.



 
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jpiniero

Lifer
Oct 1, 2010
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Sales don't stop completely, it goes to the best suited for the new cost conscious conditions.
Not supporting DDR4 in Rembrandt (and maybe AM5) is looking like a big mistake. You can see why AMD is doing that multi gen branding with 7000 series mobile because OEMs want new ("new") products. But those will mostly be Cezanne and Barcelo because they support DDR4.
 

maddie

Diamond Member
Jul 18, 2010
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Not supporting DDR4 in Rembrandt (and maybe AM5) is looking like a big mistake. You can see why AMD is doing that multi gen branding with 7000 series mobile because OEMs want new ("new") products. But those will mostly be Cezanne and Barcelo because they support DDR4.
When is Intel releasing sales/financial data again?
 
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maddie

Diamond Member
Jul 18, 2010
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That seems to be right, according to Asus the whole market contracted by -6%/Q1 and -15%/Q2 and they projected another -15% for Q3, that s -32% aggregated at the end of Q3, and that could be worse since the latter number is an estimation.



How do you build up 1/2 year inventory in such a dynamic field? This still seems unreal.
 

Abwx

Diamond Member
Apr 2, 2011
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How do you build up 1/2 year inventory in such a dynamic field? This still seems unreal.
3 months inventory is nothing special to talk about, but they surely increased the quantities to face any sudden shortage like 1-2 years ago, with sales suddenly contracting the recent production just added to the existing stored quantities...

The only mean to deplete the warhouses is massive price cuts but that will just push the problem later in 2023, albeit at short term that s the only possible outcome for such a sales bottleneck.


 

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