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AMD reports a $580m loss as graphics sales fall (theInq)

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#1) 
 PostPosted: Thu Apr 26, 2012 7:58 pm   
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http://www.theinquirer.net/inquirer/new ... sales-fall
Quote:
While AMD was busy buying one of the hottest properties in the server scene, its sales stagnated at $1.59bn, a fraction lower than in the same period last year, while it recorded a $580m loss.

Despite AMD's eye-watering $580m loss, the firm's CEO Rory Read said the financial results were solid. "AMD delivered solid results in the first quarter as we remain focused on improving our execution, delivering innovative products, and building a company around a strategy to deliver strong cash flow and earnings growth. A complete top-to-bottom introduction of new APU offerings, combined with ample product supply resulting from continued progress with our manufacturing partners, positions us to win and grow," said Read.

Although AMD will claim that revenues would be slightly higher than a year previously if it was a 14-week quarter, the fact is that for much of the quarter the firm's hottest product, the Radeon HD 7970 graphics card, was in limited supply. Such were AMD's supply problems that the firm said revenue from graphics was down seven per cent from 2011, not a good sign given that it was top dog until Nvidia's Geforce GTX 680 launched at the tail end of the quarter.



So much for being "predator" or aggresssor. Their CEO is full of hot air and evidently they have no response to Kepler
Quote:
the firm's CEO Rory Read said the financial results were solid.

(ROFLMAO)


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#2) 
 PostPosted: Thu Apr 26, 2012 8:00 pm   
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i guess if you count this, it isn't so bad
Quote:
AMD said it paid $703m to Globalfoundries for limited exclusivity on its 28nm process node for accelerated processor unit (APU) chips.


... unless supply is also constrained at GF


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#3) 
 PostPosted: Thu Apr 26, 2012 8:05 pm   

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Minus the payment to GF, there results weren't terrible. But what is telling is that ASP's for the graphics chips went up while revenue went down. That means not only did they bring in less revenue in their GPU division, they also sold fewer GPU's all around. Not exactly a winning combination. Nvidia's results should be interesting. I imagine their ASP will be down from a year ago (due to Fermi price drops), but depending on how well that drove their sales AND depending on how many GK104 chips they were able to ship in the quarter, they could have anywhere from OK to decent revenue and earnings.

On the mobile front, it does not seem like Tegra3 is getting the same adoption that Tegra4 had. I don't know for sure, but if I am right then that could be bad news for Nvidia. They need to transition to 28nm for Tegra STAT.

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#4) 
 PostPosted: Thu Apr 26, 2012 8:22 pm   
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AMD has had a pricing problem with their GPUs. They had a real lost opportunity with the 7970.


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#5) 
 PostPosted: Thu Apr 26, 2012 8:34 pm   
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tviceman wrote:
Minus the payment to GF, there results weren't terrible. But what is telling is that ASP's for the graphics chips went up while revenue went down. That means not only did they bring in less revenue in their GPU division, they also sold fewer GPU's all around. Not exactly a winning combination. Nvidia's results should be interesting. I imagine their ASP will be down from a year ago (due to Fermi price drops), but depending on how well that drove their sales AND depending on how many GK104 chips they were able to ship in the quarter, they could have anywhere from OK to decent revenue and earnings.


Good analysis. AMD's strategy GPU strategy appears to be broken.
(hamster)


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#6) 
 PostPosted: Thu Apr 26, 2012 8:41 pm   

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tviceman wrote:
Minus the payment to GF, there results weren't terrible. But what is telling is that ASP's for the graphics chips went up while revenue went down. That means not only did they bring in less revenue in their GPU division, they also sold fewer GPU's all around. Not exactly a winning combination. Nvidia's results should be interesting. I imagine their ASP will be down from a year ago (due to Fermi price drops), but depending on how well that drove their sales AND depending on how many GK104 chips they were able to ship in the quarter, they could have anywhere from OK to decent revenue and earnings.

On the mobile front, it does not seem like Tegra3 is getting the same adoption that Tegra4 had. I don't know for sure, but if I am right then that could be bad news for Nvidia. They need to transition to 28nm for Tegra STAT.


Nvidia needs to hurry up and integrate there 4g radio with Tegra, that's a big reason why you don't see many phones in the U.S with Tegra 3 chips. Take the HTC One line of phones for example, I believe all or most the European ones have Tegra chips (4g is not that big over there) while in the U.S they don't.

Nvidia bought Icera last year for this very reason so the have a complete SoC with radio, they said Tegra 3 with 4g integration should be available by years end. Until then there won't be many phones with Tegra 3 in the states which is probably why they lowered sales forecast for 2012.

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#7) 
 PostPosted: Thu Apr 26, 2012 8:44 pm   
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It speaks of poor management at the top level when big companies like this post a massive loss like that.


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#8) 
 PostPosted: Thu Apr 26, 2012 9:00 pm   

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If the goal is making money AMD's stratagy is definitely broken, but I do give them credit for there execution on how swiftly they released there 28nm line up, except for pricing it was pretty flawless. Nvidia on the other hand has only released one kepler card and were almost half way through this year, but luckily for them there fermi cards can hold there own against amd's midrange 28nm offerings.

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#9) 
 PostPosted: Thu Apr 26, 2012 9:25 pm   
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AMD needs to cut $50 or so from their GPU prices in the midrange and high end. They would be cleaning up right now if they did that. Right now they're giving people plenty of reason to wait for the GTX 660/670.


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#10) 
 PostPosted: Thu Apr 26, 2012 9:28 pm   
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Nsavop wrote:
If the goal is making money AMD's stratagy is definitely broken, but I do give them credit for there execution on how swiftly they released there 28nm line up, except for pricing it was pretty flawless. Nvidia on the other hand has only released one kepler card and were almost half way through this year, but luckily for them there fermi cards can hold there own against amd's midrange 28nm offerings.

Their engineering is superb. Their marketing and strategy is a failure. Nvidia breathed a huge sigh of relief when they saw HD 7970 priced as it was and in low availability.

Quote:
AMD needs to cut $50 or so from their GPU prices in the midrange and high end. They would be cleaning up right now if they did that. Right now they're giving people plenty of reason to wait for the GTX 660/670.

AMD is in a position of "reacting" to circumstances. Not creating them. This is a horrible position to be in - selling again on discounted pricing. Their fans will become sick of it. Their CEO was all "talk" when he spoke of being an "aggressor". And they are dropping support for relatively new cards. Sucks to be in this position.
:(


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