AMD back into the red, post 20M$ loss.

[ShintaiDK]

The consoles could only carry them for so much.

http://ir.amd.com/phoenix.zhtml?c=74093&p=irol-newsArticle&ID=1919886&highlight=

Computing solution keeps dropping and is now down to a megre 663M$ revenue. A complete disaster for the future outlook of AMD CPUs. Computing solution is what pays the CPU R&D bill.

Graphics and visual solutions also dropped hard after console sales are slowing down and AMD struggle with GPU marketshare.

 

[positivedoppler]

That must explain why their stock is up over 20 cents after this catastrophic announcement

 

[VirtualLarry]

Computing solution keeps dropping and is now down to a megre 663M$ revenue. A complete disaster for the future outlook of AMD CPUs. Computing solution is what pays the CPU R&D bill.

Ok, so the cost of CPU R&D comes out of Computing Solutions, but where is the profit recorded? Could this simply be a case of how the accounting plays out? For example, is the profit for the Consoles recorded in a different division?

 

[ShintaiDK]

That must explain why their stock is up over 20 cents after this catastrophic announcement

https://www.google.com/finance?q=AMD&ei=GuRQU8jANqf5wAOsoAE

Says -1.89% there. Or -7 cents if you like.

 

[ShintaiDK]

Ok, so the cost of CPU R&D comes out of Computing Solutions, but where is the profit recorded? Could this simply be a case of how the accounting plays out? For example, is the profit for the Consoles recorded in a different division?

Consoles doesnt make much money. And the revenue is dropping and will continue so for the future. Margins on consoles are also very low. Meaning its a very slow pace of profit to be used for anything. What you need to pay itself back in 1-2 years takes 5-10 years.

And the financials shows the reality. R&D dropped another 20M$ down QoQ to 279M$ now. A year ago it was 312M$ to compare.

 

[positivedoppler]

https://www.google.com/finance?q=AMD&ei=GuRQU8jANqf5wAOsoAE

Says -1.89% there. Or -7 cents if you like.

http://www.nasdaq.com/symbol/amd/after-hours
While I usually don't pay attention to after hours, it's up 21 cents from volume of 4.3 million after AMD announced their earnings after regular trading closed.

 

[Abwx]

And the financials shows the reality. R&D dropped another 20M$ down QoQ to 279M$ now. A year ago it was 312M$ to compare.

There s RD expenses that are not due to human workforce, hardware and softs inherently create saw like curves for such expenses every time parts of the tools are renewed so it s not straightforward to draw conclusions from such a 10% yearly variation, indeed the deltas in RD or the tiny losses are more instantaneous short term cash management than anything else, i guess that it would had been stupid to present a positive net income of 30m just to see 10m or so being sent to the taxes administrations.

 

[NTMBK]

Yikes, not good. Interestingly the Computing Solutions group actually lost less than last quarter, but the Graphics and Visual Solutions Group was significantly less profitable, despite the consoles and the crypto-rush.

 

[Abwx]

Yikes, not good. Interestingly the Computing Solutions group actually lost less than last quarter, but the Graphics and Visual Solutions Group was significantly less profitable, despite the consoles and the crypto-rush.

Computing wise it s likely that they suffered from Kaveri being a few months late and still scarce if not inexistent for the most marketable variants, i.e A8 7600 and such chips for mobile, and the AM1 plateform not launched early enough to offset said Kaveri segment products delay.

Granted Kaveri is a complexe chip but Kabini was existing since mid 2013 and the AM1 could had been launched months ago, i smell a lack of opportunism and consequently execution from the marketing team, as if Mr Read has to manage even the toilet paper color for the group to finaly execute smoothly...

 

[AtenRa]

The consoles could only carry them for so much.

http://ir.amd.com/phoenix.zhtml?c=74093&p=irol-newsArticle&ID=1919886&highlight=

Computing solution keeps dropping and is now down to a megre 663M$ revenue. A complete disaster for the future outlook of AMD CPUs. Computing solution is what pays the CPU R&D bill.

Graphics and visual solutions also dropped hard after console sales are slowing down and AMD struggle with GPU marketshare.

Excellent unbiased evaluation as always


Now lets see the data.

http://phx.corporate-ir.net/External.File?item=UGFyZW50SUQ9MjI5NzY1fENoaWxkSUQ9LTF8VHlwZT0z&t=1

Q1 2014 Results
• Revenue of $1.4 billion, down 12% sequentially and up 28% year-over-year
• Gross margin of 35%, flat sequentially
• Operating income of $49 million and non-GAAP(1) operating income of $66 million, compared to operating income of $135 million and non-GAAP operating income of $91 million in Q4 2013
• Net loss of $20 million, loss per share of $0.03 and non-GAAP(1) net income of $12 million, earnings per share of $0.02, compared to net income of $89 million, earnings per share of $0.12 and non-GAAP net income of $45 million, earnings per share of $0.06 in Q4 2013

For Q2 2014 we expect:
• Revenue to increase 3% sequentially, +/-3%.
• Gross margin to be approximately 35%.
• Non-GAAP operating expenses to be approximately $435 million, within the range of $420
to $450 million as previously guided.
• Inventory to increase slightly from Q1 2014 levels, driven by semi-custom SoCs.
• Cash, cash equivalents and marketable securities, including long-term marketable
securities balances of approximately $1 billion.

From the conference call,

- They expecting growth in Computing Segment for Q2 2014 and the rest of the year.
- Current 32/28nm, designing 20nm and FinFets later (most likelly 20nm for GPUs and 14nm FinFets in x86/ARM in 2015-2016)
- Beema started shipping in Q1 2014, OEM products in Q2 2014
- Contra Revenue is foreign to them :sneaky:


Also,

PS4 sales pass 7 Millions.

Q1 2014 may be the worst quarter of 2014. Q2 will include both shipments of Beema, Desktop Kabini, Laptop Kaveri and higher GPU volumes. They also have Berlin and ARM based Server SoCs coming.
I will say that they left the worst behind them and they starting to have a slow progress. They execute much much better now than before and they have a long run plan that seams it starts to produce results.

Lets see the rest of the year.

 

[NTMBK]

http://www.nasdaq.com/symbol/amd/after-hours
While I usually don't pay attention to after hours, it's up 21 cents from volume of 4.3 million after AMD announced their earnings after regular trading closed.

Don't read much into that kind of small scale stock market fluctuation. AMD were priced according to how analysts had predicted they would do- they did slightly better than expectations, so the price rallies a bit. Doesn't mean they did well, just better than some predictions.

 

[VirtualLarry]

http://www.pcworld.com/article/2033...-windows-8-push-pc-market-into-free-fall.html

For some perspective on the overall PC market, from last year.

 

[AtenRa]

And they expecting another 7-10% lower PC shipments for 2014.

 

[NTMBK]

Argh, ignore my previous comments about visual computing etc. I was comparing QoQ, not YoY, so it was obviously skewed by seasonal variations. YoY, things look a lot better than they did. Not good, but better.

EDIT: To illustrate what I mean, the Graphics and Visual Solutions group went from $16M income in Q1 13 to $91M in Q1 14. Those consoles have really helped shore up the bottom line, even while the traditional PC business continues to implode.

 

[AtenRa]

Argh, ignore my previous comments about visual computing etc. I was comparing QoQ, not YoY, so it was obviously skewed by seasonal variations. YoY, things look a lot better than they did. Not good, but better.

EDIT: To illustrate what I mean, the Graphics and Visual Solutions group went from $16M income in Q1 13 to $91M in Q1 14. Those consoles have really helped shore up the bottom line, even while the traditional PC business continues to implode.

Actually, GPU revenue and ASP was up Q to Q. The loss in GVS revenue Q to Q is probable due to MS lower XBone sales.

GVS segment revenue was $734 million, down 15% compared to the prior quarter, driven primarily by a decrease in sales of our semi-custom SoCs.
• GPU revenue increased sequentially due to strength in our leadership RadeonTM R7 and R9 family of products.
• GPU ASP increased sequentially.

 

[Abwx]

- Beema started shipping in Q1 2014, OEM products in Q2 2014

http://www.cpu-world.com//news_2014/2014041801_AMD_Beema_low_power_APUs_spotted.html

http://downloads.dell.com/Manuals/all-products/esuprt_laptop/esuprt_inspiron_laptop/inspiron-15-3542-laptop_Reference%20Guide_en-us.pdf?c=us&l=en&cs=&s=gen

Edit : On the financial side of things and assuming equal revenues and operating expenses their next quarters would yield a positive 193m gross income.

 

[mrmt]

Argh, ignore my previous comments about visual computing etc. I was comparing QoQ, not YoY, so it was obviously skewed by seasonal variations. YoY, things look a lot better than they did. Not good, but better.

Yes, they do. Computing solutions stopped crashing and they seem to be in line with seasonal trends now. Not bad, not bad at all. The growth talk QoQ is BS, as there is a sizable seasonality trend in Q1, but I was rather curious about the remarks of annual growth. They should have really high hopes for Beema, and given that Intel 14nm chips won't arrive in big numbers until Q115, they should be counting that Intel won't engage them in a price war and will instead lose share. Very bold assumption here.

Another thing that caught my attention is that when asked about Kaveri and Kaveri successor competitiveness, Lisa Su actually talked about Beema. I guess it's end of the line for that CMT line, whatever comes from the pipeline will be another family.

Given current margins and volumes, CPU division should have around 220 million per quarter for SG&A, R&D included. That's about half of what they had some years ago. I wonder if their plan is to consolidate the CPU line in ARM and a bigger (or more scalable) cat core.

 

[Sweepr]

Can't post a profit even with millions of PS4/XB1 sales? Never though those consoles would save the day, but damn...

Removing the hype around AMD’s console wins, the company does have considerable trouble in getting its silicon into other hardware. AMD’s hardware wins with its APUs have been light in laptops and non-existent in tablets. The only tablet win AMD highlights from its website is an 11.6-inch tablet from Vizio — a company best known for rebranding Taiwan-made ODM TVs and selling them in middle-America box stores with the sales pitch that the consumer is “buying American”. To top that off mobile Kaveri is still missing in action, and AMD’s great mobile saviour, Beema and Mullins, remains hamstrung by an uncompetitive process node.

It's already Q2 and Mullins is still MIA, probably wont show up in an actual purchasable tablet so soon. Seems like my prediction that it will spend a lot of its lifecycle competing with 16 EUs Cherry Trail-T's (and Broxton half an year later) was right.

 

[Abwx]

Can't post a profit even with millions of PS4/XB1 sales? Never though those consoles would save the day, but damn...

It's already Q2 and Mullins is still MIA, probably wont show up in an actual purchasable tablet so soon. Seems like my prediction that it will spend a lot of its lifecycle competing with 16 EUs Cherry Trail-T's (and Broxton half an year later) was right.

You should give the source of this deliberatly fud orientated article, like this
extract from your quote:

Beema and Mullins, remains hamstrung by an uncompetitive process node.

How do they know , do they have actual products on hands to make such
statements.?.

 

[strata8]

http://www.cpu-world.com//news_2014/2014041801_AMD_Beema_low_power_APUs_spotted.html

http://downloads.dell.com/Manuals/a...Reference Guide_en-us.pdf?c=us&l=en&cs=&s=gen

Also interesting: I don't think Dell has ever used an AMD APU in their laptops.

 

[Erenhardt]

Also interesting: I don't think Dell has ever used an AMD APU in their laptops.

I don't know if dell is using dell's laptos, but if they are, there is a chance they used one with AMD APU

http://www.newegg.com/Product/ProductList.aspx?Submit=ENE&N=100006740%20600165139&IsNodeId=1&Description=inspiron&name=AMD%20A-Series&Order=BESTMATCH

 

[Abwx]

Also interesting: I don't think Dell has ever used an AMD APU in their laptops.

They used a few but in confidential quantities.

http://www.walmart.com/ip/Dell-Silve...s-8.1/34206231

 

[strata8]

I don't know if dell is using dell's laptos, but if they are, there is a chance they used one with AMD APU

http://www.newegg.com/Product/ProductList.aspx?Submit=ENE&N=100006740%20600165139&IsNodeId=1&Description=inspiron&name=AMD%20A-Series&Order=BESTMATCH

They used a few but in confidential quantities.

http://www.walmart.com/ip/Dell-Silve...s-8.1/34206231

Not sold by Dell themselves though apparently. I wonder if this Beema laptop will meet the same fate.

 

[lefty2]

Two other interesting facts came out in the conference call:
1) they would start making their GPU and console chips at Global Foundaries
2) They would announce one or two new customers in 2014 for their custom design business

 

[Idontcare]

YoY numbers look great, 1.09B revenue for 1Q2013 versus 1.40B revenue for 1Q2014.

But gross margins fell by 6% (from 41% down to 35%), and perhaps more disquieting is the R&D budget decreased by more than 10% ($279m now versus $312m a year ago) despite revenue increasing by more than 28% over the same period.