Is this why AMD has been aggressively promoting Zen?

[Arachnotronic]

AMD has been promoting Polaris and Zen for quite some time, hyping up potential share gains against NVIDIA/Intel, hyping up Summit Ridge against Broadwell-E, etc.

It would appear to me that all of this PR buzz/promotion was in order to inflate the stock price high enough so that they could do a secondary equity offering: http://ir.amd.com/phoenix.zhtml?c=74093&p=irol-newsArticle&ID=2199899

SUNNYVALE, CA -- (Marketwired) -- 09/06/16 -- AMD (NASDAQ: AMD) today announced that it intends to commence concurrent public offerings, subject to market and other conditions, of approximately $600 million of its common stock (the "Shares") and $450 million aggregate principal amount of its convertible senior notes due 2026 (the "New Notes"). AMD is offering all of the Shares and the New Notes. In addition, AMD expects to grant the underwriters a 30-day option to purchase up to approximately $90 million of additional shares of common stock at the public offering price and up to $67.5 million principal amount of additional convertible senior notes.

AMD intends to use net proceeds of $1,020 million received from the offerings to repay its borrowings under its credit facility and/or to purchase its outstanding senior notes. After the completion of a tender offer for its outstanding senior notes, AMD has the option, but not the obligation, to call any and all of the untendered 7.75 percent Senior Notes due 2020 with any remaining net proceeds. AMD will use any remaining net proceeds for capital expenditures, working capital and other general corporate purposes.

They were already pretty much locked out of the debt markets since its credit rating was poor, and at $2-$3 per share it would have been very hard to raise substantial equity. At $7+ per share, they can now raise enough equity to wipe out a good chunk of their debt.

 

[whm1974]

Actually AMD has been hyping Polaris and Zen because the future of AMD is depending on them.

 

[krumme]

That is a brilliant plan ! Wow

- Elvis helped them

 

[Arachnotronic]

That is a brilliant plan ! Wow

- Elvis helped them

I have to agree that it was a smart financial move for them.

 

[Madpacket]

If AMD can deliver with Zen and Vega like they did with Polaris (minus availability issues) then the hype is justified. Using the new stock price to pay off debt will put them in a much better position to spend more on R&D, use better fabrication facilities, and ultimately make better products. It's kind of crazy how AMD has survived this long, hard not to root for them at this point.

 

[krumme]

I have to agree that it was a smart financial move for them.

Amd have historically diluted their stock more times than you have taken a piss in your entire life.
You might want to rethink this marketing brings 250% uplift story to amd stock as its completely insane - though funny.

 

[piesquared]

Or they could be promoting their products because, you know, thats what all companies do and should do.

 

[MajinCry]

Or they could be promoting their products because, you know, thats what all companies do and should do.

Bingo.

Every capitalist thing that ever capitalized on things advertised to capitalize on advertising.

 

[lukart]

Amd have historically diluted their stock more times than you have taken a piss in your entire life.
You might want to rethink this marketing brings 250% uplift story to amd stock as its completely insane - though funny.

One day they will have to do a reverse stock split after all this AMD stock hype settles

 

[IEC]

Wait, AMD marketing actually did their jobs correctly for once?

 

[zinfamous]

well, that's one of the more asinine conspiracy-laden theories I've seen in this forum. This is P&N quality stuff.

lol, I expected more of you, OP.

 

[Arachnotronic]

well, that's one of the more asinine conspiracy-laden theories I've seen in this forum. This is P&N quality stuff.

lol, I expected more of you, OP.

Why is it asinine?

 

[Fanatical Meat]

Actually AMD has been hyping Polaris and Zen because the future of AMD is depending on them.

Yup if Zen stinks AMD is done.
What are the realistic odd Zen will be great. I haven't followed it much.

 

[Phynaz]

AMD diluting again. Fourth time in eight years

 

[frozentundra123456]

If AMD can deliver with Zen and Vega like they did with Polaris (minus availability issues) then the hype is justified. Using the new stock price to pay off debt will put them in a much better position to spend more on R&D, use better fabrication facilities, and ultimately make better products. It's kind of crazy how AMD has survived this long, hard not to root for them at this point.

They "delivered" on polaris based on price and the red hot mining craze. Clearly they did not deliver on performance per watt, which ultimately they will pay for in laptops (my local microcenter already has gaming laptops with 1060/1070/1080 cards in them), and they sure better deliver much better on performance per watt relative to the competition with Zen. Actually, I am amazed the stock hasnt crashed considering how poor the power use is of polaris and the fact that they have been absent for months already and will be absent many more months in the high end dgpu market.

 

[Maxima1]

Why is it asinine?

It's obvious that Zen would be aggressively promoted because it's suppose to be much better. Polaris gets hyped because there was no shrink for ages.

 

[IllogicalGlory]

So... AMD used to be worth $2 a share and has debt. Whew, almost forgot for a second there, thanks for reminding me OP.

 

[Arachnotronic]

So... AMD used to be worth $2 a share and has debt. Whew, almost forgot for a second there, thanks for reminding me OP.

That was not the purpose of this thread.

I was just pointing out what appears to me like a real effort on AMD's part to increase its stock price substantially in order to make raising capital easier. Agree or disagree, but just crapping on the thread or calling it "asinine" as another poster did without backing it up seems a bit harsh.

 

[Arachnotronic]

If AMD can deliver with Zen and Vega like they did with Polaris (minus availability issues) then the hype is justified. Using the new stock price to pay off debt will put them in a much better position to spend more on R&D, use better fabrication facilities, and ultimately make better products. It's kind of crazy how AMD has survived this long, hard not to root for them at this point.

Appreciate the well-reasoned opinion!

 

[Burpo]

That was not the purpose of this thread.

I was just pointing out what appears to me like a real effort on AMD's part to increase its stock price substantially in order to make raising capital easier. Agree or disagree, but just crapping on the thread or calling it "asinine" as another poster did without backing it up seems a bit harsh.

And this has to do with CPUs and Overclocking how?

Prolly not the best place for it..

 

[Arachnotronic]

And this has to do with CPUs and Overclocking how?

Prolly not the best place for it..

There have been threads started about company financial results in both the CPU and VC&G forums, and this is in a pretty similar vein so I posted it here.

That being said, if a moderator (or really most people in this sub-forum) thinks this isn't the appropriate place, I would appreciate having it moved to the appropriate sub-forum for the discussion to continue.

 

[superstition]

A "The Computing Biz" subforum would be nice to have for all the economics/financials/marketing discussions.

There is clearly interest since this stuff gets talked about here frequently. Maybe a sticky link for "CPU financials and marketing" that would take someone to that subforum, too? Then change the name of this one to "CPU Technical Discussion".

 

[Arachnotronic]

A "The Computing Biz" subforum would be nice to have for all the economics/financials/marketing discussions.

There is clearly interest since this stuff gets talked about here frequently.

I agree! The business side of things is important, as all of the products we see are driven primarily by business/financial decisions/constraints. And, frankly, it's just a heck of a lot of fun to talk about this stuff.

 

[zinfamous]

A "The Computing Biz" subforum would be nice to have for all the economics/financials/marketing discussions.

There is clearly interest since this stuff gets talked about here frequently. Maybe a sticky link for "CPU financials and marketing" that would take someone to that subforum, too? Then change the name of this one to "CPU Technical Discussion".

yes! more fragmentation of AT forums, because that has been working so well!

 

[superstition]

yes! more fragmentation of AT forums, because that has been working so well!

Do you mean the way GPUs come up so often in AMD discussions here?