AMD crushes Q4 earnings estimates

[Genx87]

AMD's lower margins are actually an advantage for AMD. Intel's high margins are the very reason Intel tried and failed to enter numerous markets as their business there could never dream to reach the margins their core business achieves, by which every effort is measured. It's in AMD's own interest to not back themselves into that corner anytime soon.

I have now heard it all. Lower margins are an advantage. Somebody get on the horn to AMD and let them know since they are trying to raise their margins for obvious reasons.

 

[Topweasel]

@eek2121 thanks

Did you watch the video? He specifically bought retail Threadripper and Epyc CPUs. He specifically pointed out that the traces appear to be the same. That Threadripper wouldn't be able to use the additional Epyc pins should be obvious, none of the SP3v2/TR4 boards would be prepared for it anyway. But IF is already able to route any memory controller and any PCIe interface through any die anyway, so Threadripper's limit to 4 channels and 64 lanes doesn't require to disable dies, it would just naturally increase latency and bandwidth saturation.

I thought someone was linking his original Threadripper sand down. Which was a pre-release review sample he wrecked trying to delid.

 

[moinmoin]

I have now heard it all. Lower margins are an advantage. Somebody get on the horn to AMD and let them know since they are trying to raise their margins for obvious reasons.

When you look at Intel's history in entering new markets it's a huge wasteland of abandoned efforts and regular waves of blunt workforce cuts. Intel has an exemplary margin for a manufacturing company (all other companies in this margin range don't or no longer manufacture on their own), and keeping that margin intact has become Intel's one central goal to which everything else play second fiddle to. Aside entering new markets the issues Intel has with 10nm and the whole Meltdown/Spectre mishandling should make it obvious this whole development can't be good for the long term health of the company.

I thought someone was linking his original Threadripper sand down. Which was a pre-release review sample he wrecked trying to delid.

The video I linked is from 10 days ago and an update to the video you are thinking of.

 

[Topweasel]

When you look at Intel's history in entering new markets it's a huge wasteland of abandoned efforts and regular waves of blunt workforce cuts. Intel has an exemplary margin for a manufacturing company (all other companies in this margin range don't or no longer manufacture on their own), and keeping that margin intact has become Intel's one central goal to which everything else play second fiddle to. Aside entering new markets the issues Intel has with 10nm and the whole Meltdown/Spectre mishandling should make it obvious this whole development can't be good for the long term health of the company.


The video I linked is from 10 days ago and an update to the video you are thinking of.

I realize that now, still stand by the fact that chances are that X399 isn't wired for fully a unlocked CPU.

 

[dawheat]

I think AMD can get to atleast 10% server share (probably even more) by end of 2018. Its quite possible and very realistic given the Meltdown patch performance hit to Intel server CPUs. btw Lisa Su expects to hit 5% server share by Q4 2018 and she is very very conservative when giving out financial guidance like growth %, gross margin % or even share gain expectations. charlie believes Intel's server share will take a huge hit and he seems to know that AMD EPYC is ramping big at the cloud providers and OEMs. He even stated "I have a very good idea of what orders are placed and by whom, not to mention when. I am laughing at the low-to mid-single digit bit though." when i told him people still think EPYC will only get low to mid single digit share.

https://semiaccurate.com/2018/01/04/kaiser-security-holes-will-devastate-intels-marketshare/

https://twitter.com/ryanshrout/status/954015419832119297

I think showing this type of result is what's necessary for AMD stock to move significantly higher than the range it's been bouncing between the last year. I think you'll still be able to play the volatility over the next couple quarters if you're into that and then finally buy long term into it closer to the end of the year.

 

[eek2121]

@eek2121 thanks

Did you watch the video? He specifically bought retail Threadripper and Epyc CPUs. He specifically pointed out that the traces appear to be the same. That Threadripper wouldn't be able to use the additional Epyc pins should be obvious, none of the SP3v2/TR4 boards would be prepared for it anyway. But IF is already able to route any memory controller and any PCIe interface through any die anyway, so Threadripper's limit to 4 channels and 64 lanes doesn't require to disable dies, it would just naturally increase latency and bandwidth saturation.

Very little is known about X399 and it's capabilities, much less the motherboards that use it. Also, X499 (or whatever AMD calls it) would undoubtedly improve things. The fact that there are 4 dies on the CPU tells me that they prepared for 32 cores (in case Intel decided to up the game), but ended up not doing it. I haven't seen any detailed shots of an X399 motherboard (other than reading tech documentation, which could EASILY leave things out), but I wouldn't be surprised if AMD worked with board manufacturers to support a possible 32 core CPU with more PCIE lanes and 8 channel RAM....at the very least for x499 (with X399 falling back to quad channel RAM, etc). Note that I don't bring this up as a subject of debate. It's just that I know the AMD of old, and I'm starting to understand Lisa Su's style. She likes to keep expectations low and over deliver. I hope her tenure at AMD lasts for a while, because she will carry them far. I also am not an AMD fanboy, but year after year of pitiful performance increases has me fed up with Intel. I wouldn't have purchased my Threadripper if it couldn't compete with Intel chips, but it does. It does so very well. IMO Ryzen Gen1 is the equivalent of the K6-2. Worst case, Zen+ will be the K6-3. If Zen+ ends up being the equivalent of the Athlon...well...Intel deserved it. In all cases, unless Intel is already taking steps to turn things around, Zen2 is going to be the equivalent of the Athlon, and Intel will once again find themselves 2nd in a 2 horse race. I hope it happens, not because I want either company to lose, but because I want Intel to stay on it's toes and remember that you can't slack off in this industry. I own Intel and AMD shares (though due to a purchasing spree last month my AMD shares now vastly outnumber the intel ones), so I have money involved on both sides. Whichever happens, I hope to god it's a win for we, the consumers.

 

[Genx87]

When you look at Intel's history in entering new markets it's a huge wasteland of abandoned efforts and regular waves of blunt workforce cuts. Intel has an exemplary margin for a manufacturing company (all other companies in this margin range don't or no longer manufacture on their own), and keeping that margin intact has become Intel's one central goal to which everything else play second fiddle to. Aside entering new markets the issues Intel has with 10nm and the whole Meltdown/Spectre mishandling should make it obvious this whole development can't be good for the long term health of the company.

Eh while I can agree that their fixation on margins has shelved some products. Namely their GPU selections. Even if they ended up using that technology in other products. As a company it has hardly been bad for their long term health. They have generated billions in wealth for their shareholders and crushed their competition in the process. Intel had profits nearly 5x larger than AMDs revenues.

Intels downfall is the same as AMDs. They are fighting over an ever shrinking market. x86 has been shrinking for years.

With that said high margins absolutely desirable for any company. Intel knows this, and so does AMD.

 

[scannall]

I do think the title of the thread is a bit off. I wouldn't say 'Crushed' by any means. They did well. A bit better than expected, and good on them. It buys them some breathing room, and some R&D money to keep pushing forward. That's good for everyone, even if you don't like AMD.

 

[krumme]

34% margins in this space is horrible. Their competition is into the 60s.

No its a disgrace and a testament to lack of compettition that double that is normal. Shows the market is monopolized. For natural reasons and cant be different but still very inefficient.

Everybody tries to up their margins. Its like asking people if they want higher salery. Who dont want that?. But typically what acutally gives high margins is a dominant position on the market. So revenue normally precedes margins. You go for revenue first then you shape and optimize for margins.

 

[KompuKare]

Intels downfall is the same as AMDs. They are fighting over an ever shrinking market. x86 has been shrinking for years.

But as by far the biggest CPU vendor for PCs (and one of the most profitable tech companies in general), couldn't it also be said that their obsession with margins has contributed to the decline of x86?

Okay, the low hanging fruit is long picked and it's hard to keep making faster x86 CPUs every year but why should a consumer who has, for example, a CPU from even the Sandy Bridge era bother to upgrade when each generation only brings about 5%. I used to upgrade more frequently (admittedly a fair few of those upgrades was in the days of when you could take Core2 Pentium and overclock it by 30-50%), but generally only when I could double my previous speed.

Point being that Intel's crazy market segmentation has been great for their margins, not great for consumers, and - at least arguably - may have contributed to the decline of x86 PCs. If you don't give people a reason to upgrade, you are dependent on new markets or people replacing PCs which have actually broken.

 

[dullard]

The biggest worry that AMD probably has is the end to the mining craze. With millions of used CPUs/GPUs on the market fighting for the low-cost buyers AMD could be in a world of hurt. Of course, if the mining craze continues, then AMD will keep doing well.

Looks at Bitcoin down 28% today. Looks at AMD down 10.4% today (triple the drop of the broader market). Looks above at my post. I think I jinxed them with that post.