AMD Posts Banner Q3 Financial Results; Returns To Profitability, But Stock Drops

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tyns78

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Oct 25, 2017
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From an investment standpoint, AND is a wet dog with fleas. Stock is dramatically overvalued, their agreement with GloFo is a yoke around their necks, and the reason they don't split out graphics financials from CPU (they did until recently) is because the graphics unit consistently hemorrhages cash.

Feel free to cheer on the company for their products, but don't make the mistake with your investments. Citi's $5 target is too low simply because the irrational investors will keep it propped under higher, but I wouldn't be a buyer over $10, probably closer to $8
 

InvalidError

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Profit from GPUs is going to soar from datacenter, AI and other compute demand. AMD itself landed a few deals for such projects this year with Vega.

Unfortunately for gamers, this means gaming GPUs are going to become second-rate priorities for Nvidia and AMD's budgets. Expect the gap between new architectures for datacenters and benefits from those new architectures trickling down to consumer GPUs to widen.
 

nitrium

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I don't know how the internals breakdown, but you would think the fact that BOTH of the major consoles running their GPUs would be significant(?). I'm guessing the next-gen consoles will also almost certainly go AMD for backward compatibility reasons. Or is AMD just about subsidising Microsoft and Sony to convince them to use AMD parts?

 

TJ Hooker

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Console chips are under AMD's "Semi-custom" category, which is separate from desktop/laptop CPUs/GPUs. So they wouldn't affect those financials.
 

nitrium

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Ok. But then losses in the GPU sector would be offset by sales in "Semi-custom" sector, since they can't possibly provide the latter without investing in the former. So analysis of the internals aren't as simple as stating the "graphics unit consistently haemorrhages cash", right?

 

mapesdhs

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The Good Old Gamer posted an interesting video about this issue back in May:

https://www.youtube.com/watch?v=PkeKx-L_E-o

Ian.

 


This comment is so backward it's stunning. You do realize that the GPU department is the only reason AMD didn't file bankruptcy years ago. They kept the company going while bulldozer and it's derivatives were their CPU architecture.

Plus, I think you underestimate the shear numbers of GPU's they are selling. Even at inflated prices, demand has been insane. Whether it's gamers or miners, the GPU's are barely ever in stock, anywhere, meaning they are flying off the shelves as fast as they can produce them.

Ryzen is a great product, but AMD can't rush another launch the way Intel did with Coffee, and that lead that Intel has is what is making investors nervous. They are afraid that Intel will open a performance gap again they way it was with bulldozer. Which AMD can't afford.

Until Ryzen, the CPU department was hemorrhaging cash.
 

redgarl

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A lot of people trying to put logic between the drop in stock and AMD numbers... well, guess what, there is none. AMD is the stock that is the most speculative on Wall street because the potential is huge. AMD is one of the two companies working on GPU which is driving AI.

The next 10 years are going to be better than the 10 last. It's obvious especially that AMD is switching at 7nm and launching new silicon in 2019. The GloFo deal will payoff 2018, unfortunately, not before.
 

knowom

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Citi Research sell rating by 60% based on Coffee Lake is crazy. Ryzen 1600/1700 are the best value for dollar. You need to take into account the motherboard cost which for Ryzen is far less costly than it's counterpart. Relative CPU performance across programs is much higher compared to similarly prices Intel CPU's. The one strong point for Coffee Lake is higher refresh rate displays which is primarily only 1080p. Once you move up to 1440p and 4K the results disappear as the refresh rate and FPS no longer becomes the bottleneck.

I think more of it stems from unfair skepticism of Vega that is selling like candy despite it's modestly luke warm mediocre game performance overall at present however as DX becomes more prolific it certainly evens out a bit more nicely. Vega also has the crypto currency play which could or could not start to wane, but probably safe to say won't overnight. It's not just that however Vega basically annihilates Nvidia at 3D content creation and they just added support for like what 12 GPU's RENDER FARMS???? CRYPTO FARMS???? either way...they got a lot going on plus Thread Ripper and Epyc as well and APU that's off the charts and 7nm on the horizon.

I think they analysts have blind folds on right now in regard to what's about to happen with AMD over the next 2-3 years. It feels like they are about to enter into another AMD64 type of era of success. That is what my gut tells me. A lot of analysts weren't so keen on Nvidia back when CUDA was relatively new either for the record and boy were they ever wrong dragging the brakes on that steam engine railroading across country.
 

fehl83

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Nov 8, 2017
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What happens to GPU sales when Ethereum tanks and ebay is flooded with RX480/RX580/RX570 etc? Concern there.

From what I have read, Vega is garbage for mining. The power cost to performance ratio is terrible. As a gamer, I don't care about power. I plan on buying a Vega64 during the Black Friday fun because it beats the 1080 in quite a few titles. But, if I were a miner I would not go with Vega. So I don't think Vega is selling because of mining potential.

Hearing that AMD has increased R&D budget and the fact that Intel seems to have NVIDIA in its crosshairs is what is giving me hope right now.
 

TJ Hooker

Glorious
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Eh, people have been talking about this since Eth first 'tanked' in July, but I have yet to see any meaningful supply of cheap, used cards hit the market.
http://www.tomshardware.com/news/ethereum-price-drop-difficulty-increase,34985.html
Maybe Eth will actually collapse beyond recovery at some point, but even if that happens there may very well be other cryptocurrencie(s) taking its place, keeping miners busy and holding onto their cards.
 
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