AMD Q2 '13 results above expectations.

[Centauri]

Consensus was for a Q2 loss at $0.13 per share on revenue of $1.11 billion.

Results were;

Revenue of $1.16 billion, increased 7 percent sequentially and decreased 18 percent year-over-year.
Gross margin 40 percent.
Operating loss of $29 million, net loss of $74 million, loss per share of $0.10
Non-GAAP(1) operating loss of $20 million, net loss of $65 million, loss per share of $0.09

http://finance.yahoo.com/news/amd-reports-2013-second-quarter-201500544.html

Guidance within the hour.

 

[frozentundra123456]

Consensus was for a Q2 loss at $0.13 per share on revenue of $1.11 billion.

Results were;

Revenue of $1.16 billion, increased 7 percent sequentially and decreased 18 percent year-over-year.
Gross margin 40 percent.
Operating loss of $29 million, net loss of $74 million, loss per share of $0.10
Non-GAAP(1) operating loss of $20 million, net loss of $65 million, loss per share of $0.09

http://finance.yahoo.com/news/amd-reports-2013-second-quarter-201500544.html

Guidance within the hour.

Well, I guess a loss of less than predicted is some sort of positive news. Really though, how long can a company continue without making a profit?

 

[sontin]

They shipped Kabini and Richland. So that will increase revenue for a short time. The question is what will happend after the first real shipments.

And there guidance is 22% +-3% up for Q3: Shipments for Sony and Microsoft.

Their gpu business is down again. And operate income is only breakeven. So they paid for the next never settle pack or they increased inventory for the gpu refresh.

 

[SiliconWars]

Well, I guess a loss of less than predicted is some sort of positive news. Really though, how long can a company continue without making a profit?

With console revenue coming in fast they are basically guaranteed to make a profit in the 2nd half of the year.

 

[TuxDave]

Well, I guess a loss of less than predicted is some sort of positive news. Really though, how long can a company continue without making a profit?

Can anyone do the math to see if AMD has a net profit over its lifetime?

 

[f1sherman]

On the plus side their conference calls have some of the best elevator music :thumbup:

 

[SiliconWars]

Their gpu business is down again. And operate income is only breakeven. So they paid for the next never settle pack or they increased inventory for the gpu refresh.

GPU revenue was flat so it must have been console income that was down in Q2, which isn't all that surprising.

Also,

GPU ASP decreased sequentially and increased year-over-year.

The YoY increase is amazing considering they have increased ASP with tech that is a year old. This is proof that "Never Settle" is working very well for them, even at the obvious cost.

 

[ShintaiDK]

CPU ASP down, margins down, posting a loss.

Above expectations is surely a funny definition.

 

[sushiwarrior]

CPU ASP down, margins down, posting a loss.

Above expectations is surely a funny definition.

Things don't just turn around at the blink of an eye. Looks like they are in good shape to start running even next quarter, at this rate they may be making money in 2014.

 

[SiliconWars]

CPU ASP down, margins down, posting a loss.

Above expectations is surely a funny definition.

Not really, above expectations simply means that it's...above expectations.

There was no expectation of 12% increased CPU revenue (vs Intel's 1.4%), that is simply why it's "above expectations".

 

[sontin]

Gross Margins for Q3 should be around 36%.
And custom designs silicon will be lower than coperate average of 40%.

Any question why AMD won the console designs?

 

[gloom111]

I agree, AMD's profits will likely go up in the third and fourth quarter due to XBox One and PS4 production. Both systems will be using AMD chips and are projected to be released for the holiday season.

 

[sontin]

GPU revenue was flat so it must have been console income that was down in Q2, which isn't all that surprising.

Yes, they said it. Shows that their GPU business is not really making money.

Also, The YoY increase is amazing considering they have increased ASP with tech that is a year old. This is proof that "Never Settle" is working very well for them, even at the obvious cost.

GPU business is down Y-Y for the half year. So no, i don't believe their ASP increase. Last year at this point nVidia only had GTX670 and GTX680 on the market. Now they have the full line up and pushed AMD down in the price stack and their ASP grew? :hmm:

 

[AtenRa]

Now they have the full line up and pushed AMD down in the price stack and their ASP grew? :hmm:

They selling less sub $100 and more $100+ cards

 

[sontin]

They selling less sub $100 and more $100+ cards

Last year at this point their cards cost much more than today. So i don't understand how they have higher ASP with 13% lower revenue and 75% lower operate income.

That would mean that they reached the bottom of their low end business...

 

[SiliconWars]

Gross Margins for Q3 should be around 36%.
And custom designs silicon will be lower than coperate average of 40%.

Any question why AMD won the console designs?

:awe: {tagging this for 3 months time}

Yes, they said it. Shows that their GPU business is not really making money.

GPU business is down Y-Y for the half year. So no, i don't believe their ASP increase. Last year at this point nVidia only had GTX670 and GTX680 on the market. Now they have the full line up and pushed AMD down in the price stack and their ASP grew? :hmm:

Ok so they are just lying about increasing ASP in their CC? Why would they risk the wrath of the authorities by doing that? Clearly GPU ASP is up. Volume may be down but ASP can increase because of a shift to higher end buyers. And let's face it, it's not like Nvidia has anything that can compete with AMD's 79xx cards on value when the Never Settle bundle is taken into consideration.

 

[sontin]

:awe: {tagging this for 3 months time}

This is AMD's guidance...

Ok so they are just lying about increasing ASP in their CC? Why would they risk the wrath of the authorities by doing that? Clearly GPU ASP is up.

How would you verify it? Since three quarters they're talking about record quarters and quarters and yet their revenue is down.
So their ASP is down Q-Q but up Y-Y with cards at a higher price point...

And let's face it, it's not like Nvidia has anything that can compete with AMD's 79xx cards on value when the Never Settle bundle is taken into consideration.

What? nVidia had Metro:LL and now Splinter Cell:BL...

 

[boxleitnerb]

Never Settle is not free for AMD, it surely costs millions. Besides, the bundled games are not exactly new (so people either already have the game(s) or they can get them much cheaper than before), and right now we have the Steam summer sale which further erodes the value of the bundle. How much market share did AMD gain due to the bundle? 1-2% if I'm not mistaken?

 

[SiliconWars]

Last year at this point their cards cost much more than today. So i don't understand how they have higher ASP with 13% lower revenue and 75% lower operate income.

That would mean that they reached the bottom of their low end business...

MORE people are buying 79xx cards than they were last year, LESS people are buying the cheaper cards. Even with the price drop there are clearly a lot more 79xx sales than were at this time last year, so overall ASP is up.

This allows AMD to save wafers on low end GPU and put more into Jaguar. It appears to be a working strategy.

 

[mrmt]

Last year at this point their cards cost much more than today. So i don't understand how they have higher ASP with 13% lower revenue and 75% lower operate income.

Probably less bottom marketdesktop cards, more notebook dGPUs.

 

[SiliconWars]

Probably less bottom marketdesktop cards, more notebook dGPUs.

Yes this is probably closer to the mark.

 

[sontin]

:awe: {tagging this for 3 months time}

A second quote:
And they said it a second ago. It's the console business which will be responsible for the lower gross margins.

That means their margins on these custom SoCs is around <=20%.

 

[boxleitnerb]

Probably less bottom marketdesktop cards, more notebook dGPUs.

How do you figure? What new products does AMD have in that sector? Their higher end notebook dGPUs are rebrands, only the really low end parts are new (Mars and Venus).

 

[Dresdenboy]

Gross Margins for Q3 should be around 36%.
And custom designs silicon will be lower than coperate average of 40%.

Any question why AMD won the console designs?

I think this is usual custom design business. For own products AMD has more costs regarding R&D, and Marketing. For a custom design, they might already get money for designing the chip, as it happened with the console SoCs. And they add revenue in new markets, additional to their existing revenue created by owning some marketshare in CPUs, GPUs.

GPU business is down Y-Y for the half year. So no, i don't believe their ASP increase. Last year at this point nVidia only had GTX670 and GTX680 on the market. Now they have the full line up and pushed AMD down in the price stack and their ASP grew?

The CFO commentary mentioned a record quarter for professional graphics. This definitely increases ASP. Also reducing unit share by selling less small GPUs (due to APUs or Intel processor graphics) increases ASP.

 

[sontin]

I think this is usual custom design business. For own products AMD has more costs regarding R&D, and Marketing. For a custom design, they might already get money for designing the chip, as it happened with the console SoCs. And they add revenue in new markets, additional to their existing revenue created by owning some marketshare in CPUs, GPUs.

They're talking about it right now.
Lower Opex but lower gross margins. But the problem is: What happend if you don't find new customers?
It looks that they're really transforming into ARM or ImgTech. Offering solutions but no actual products...