ExtremeTech asks, "How can AMD be fixed?"

[JCon]

Those are all management mistakes. AMD makes awesome chips, and ATi makes awesome GPUs. However when management is making such large fundamental mistakes there is no reason to be optimistic in their future performance.

Rely on the tech, replace the execs!

I don´t think so. Comparing the car industry with the computer industry is like comparing the eating habits of a christian farmer and a big town crack junkie. Both are humans, but that´s it.
Growth is one of the most important things for a corporation. I´m quite confident that a car is used at least three times as long as an average CPU - and that´s a pretty conservative estimation. I can buy a 15 year old car and it will do fine. I can´t run a 15 year old CPU though. It won´t do Windows XP and i have my doubts that i can even find a mainboard for it.
Calling AMDs move to grow a mistake is wrong. It was risky so i´d call it a gamble.

I don't understand your reference to the automobile industry. I never made mention of it...

Anyways, the growth that you called risky was actually foolish. Alongside the other fundamental mistakes they made, this should cost the top brass their jobs. No, if they had only made one mistake, they should not lose their jobs, but making three major mistakes and possibly permanently hurting the company should lead to dismissal.

Read the article, the analysts are clear on what mistakes AMD made and most, if not all, of these could have been prevented.

 

[Twisted_Sister]

Nice article Baron... love reading all the angles.

Unfortunately, this article is just a cut & paste job for the most part. They basically just took snippets from already posted analyst commentary.

A few points, that I completely agree with and have stated before:

1) AMD is overextended... trying to compete with Intel (and now Nvidia) on all fronts. Be everything to everyone. This is just folly at this time.

2) AMD needs to secure external capital to make it through Q4. The internal $$ cuts will likely not be enough. Possible alternatives for AMD will be to slash margins even further and flood the market with ubber cheap CPUs.

Short term - generates cash, long term - you undercut your own future demand for new products. Also, it's too easy for Intel to respond in kind.

Also look for them to start prolonging payments to vendors (e.g. accounts payables)... a classic tactic to conserve cash.

 

[JCon]

Also look for them to start prolonging payments to vendors (e.g. accounts payables)... a classic tactic to conserve cash.

That would be a good strategy. The investors would be in a better situation to receive money owed to them, rather than AMD having to file for BK.

I would be curious to see if there is any room for movement with the financiers to adjust or delay some payments.

 

[BaronMatrix]

Nice article Baron... love reading all the angles.

Unfortunately, this article is just a cut & paste job for the most part. They basically just took snippets from already posted analyst commentary.

A few points, that I completely agree with and have stated before:

1) AMD is overextended... trying to compete with Intel (and now Nvidia) on all fronts. Be everything to everyone. This is just folly at this time.

2) AMD needs to secure external capital to make it through Q4. The internal $$ cuts will likely not be enough. Possible alternatives for AMD will be to slash margins even further and flood the market with ubber cheap CPUs.

Short term - generates cash, long term - you undercut your own future demand for new products. Also, it's too easy for Intel to respond in kind.

Also look for them to start prolonging payments to vendors (e.g. accounts payables)... a classic tactic to conserve cash.

You guys should all go and join Bear-Stearns. You're wasting your financial acumen here.

Even Mercury Research knows less about the industry than Forum members.
8O

 

[BaronMatrix]

i think your avatar symbolizes your desire to bait and not DEBATE. Peddie works for Mercury Research. Are you obtuse and lacking in reading skills? It was only 3 pages.

I found it a little funny.

I mean I even HIGHLIGHTED their opinion about CH11.

I guess DOOM and GLOOM is all you can muster.

You highlighted no such thing.... you highlighted:

"Intel has succeeded in bloodying AMD's nose," Peddie said. "But it's not a knockout punch, and it sure as hell isn't a killer punch."

No where in the highlighted text does Peddie mention Chapter 11 either averting it or heading for it.

Chapter 11 is specifically used so a company is not killed. It is an option available to AMD (and more importantly, their creditors) for salvaging disaster and remaining in business.

You have a problem with reading comprehension and plays into your modus operandi of selectively quoting what you like as opposed to reality.

jack


So the term "Knockout Punch" and "Killer Punch" don't refer to such things. How can you be so sickening? You're like this big silly kid who has to be the center of the world and will do any manner of lowdown thing if anyone threatens it.

Too bad, but I hear there are therapists who specialize in that kind of thing.

 

[Twisted_Sister]

You guys should all go and join Bear-Stearns. You're wasting your financial acumen here.

Even Mercury Research knows less about the industry than Forum members.
8O

Ahh... John Peddie... research analyst & your current hero. Let's take a few of his other quotes:

June 2006

Since I didn’t go to Computex this year, I had the benefit of a cooler head and the distance of reason, and so I’m utterly convinced AMD will not buy ATI.

:roll:


Mar 2007

Mr. Peddie sees Intel playing catch-up in two markets: ultra-mobile PCs and highly integrated chips. “Even though they are arriving late, I fully expect them to become exceedingly dominant in this category,” he said. “Intel right now can be declared the leader in micro-miniaturization of transistor technology.”

http://www.redherring.com/Article.aspx?a=21844
http://www.jonpeddie.com/Back_Pages/2006/06-19-06_smoke.shtml

 

[BaronMatrix]

You guys should all go and join Bear-Stearns. You're wasting your financial acumen here.

Even Mercury Research knows less about the industry than Forum members.
8O

Ahh... John Peddie... research analyst & your current hero. Let's take a few of his other quotes:

June 2006

Since I didn’t go to Computex this year, I had the benefit of a cooler head and the distance of reason, and so I’m utterly convinced AMD will not buy ATI.

:roll:


Mar 2007

Mr. Peddie sees Intel playing catch-up in two markets: ultra-mobile PCs and highly integrated chips. “Even though they are arriving late, I fully expect them to become exceedingly dominant in this category,” he said. “Intel right now can be declared the leader in micro-miniaturization of transistor technology.”

http://www.redherring.com/Article.aspx?a=21844
http://www.jonpeddie.com/Back_Pages/2006/06-19-06_smoke.shtml


Predictions aren't the same as market acumen. Not that it matters but I didn't think they would do it either but it got them into the Top 10 semi list.

I would think that they would thereby be in a position to weather a storm not as bad market share and revenue wise as 2001.

Betting on K10 and R600 being flops is like saying the next Lamborghini won't be better than the current one. That's what they do. And with a modicum of resources compared to Intel. K8 is proof of that.

 

[ElMoIsEviL]

This wasn't from mercury research the above comment was from Jon Peddie of Jon Peddie research (whoever he is) and I would harldly call him the horses mouth.

The truth of the matter is that AMD is in the doghouse financially. They tried to do too much too fast and are now paying dearly for it. Cutting capex is not the answer to staying competitive with intel long term. Each process node gets ever more expensive. If you get too far behind on process tech when you are up against intel you are screwed.

Also we can't forget about intel's very agressive upcoming pricecuts. They are already selling their flagship X2 6000 for under $300 and K10 is 2 - 3 quarters too late to save them.

I don't think chapter 11 is definite at this point, but it is a very real possiblity. I say greater than 50% chance they do chapter 11 and recapitalize. At some point if things don't turn soon, it would be in their best interest.

i think your avatar symbolizes your desire to bait and not DEBATE. Peddie works for Mercury Research. Are you obtuse and lacking in reading skills? It was only 3 pages.


I mean I even HIGHLIGHTED their opinion about CH11.

I guess DOOM and GLOOM is all you can muster.

Jogn Peddie does not work for Mercury Research.

John Peddie Research

Small unknown business.

 

[BaronMatrix]

This wasn't from mercury research the above comment was from Jon Peddie of Jon Peddie research (whoever he is) and I would harldly call him the horses mouth.

The truth of the matter is that AMD is in the doghouse financially. They tried to do too much too fast and are now paying dearly for it. Cutting capex is not the answer to staying competitive with intel long term. Each process node gets ever more expensive. If you get too far behind on process tech when you are up against intel you are screwed.

Also we can't forget about intel's very agressive upcoming pricecuts. They are already selling their flagship X2 6000 for under $300 and K10 is 2 - 3 quarters too late to save them.

I don't think chapter 11 is definite at this point, but it is a very real possiblity. I say greater than 50% chance they do chapter 11 and recapitalize. At some point if things don't turn soon, it would be in their best interest.

i think your avatar symbolizes your desire to bait and not DEBATE. Peddie works for Mercury Research. Are you obtuse and lacking in reading skills? It was only 3 pages.


I mean I even HIGHLIGHTED their opinion about CH11.

I guess DOOM and GLOOM is all you can muster.

Jogn Peddie does not work for Mercury Research.

John Peddie Research

Small unknown business.

Small unknown businesses do not get interviewed for major online publications.


I guess I have to say I'm spreading FUD rather than reading about too much of this stuff along with my other 3 jobs. I don't know why I hear his name along with Mercury Research.

Dr. Jon Peddie has been active in the graphics and multimedia fields for more than 30 years. Jon Peddie Research is a technically oriented multimedia and graphics research and consulting firm. Based in Tiburon, California, JPR provides consulting, research, and other specialized services to technology companies, including graphics development, multimedia for professional applications and consumer electronics, high-end computing, and Internet-access product development. Jon Peddie's Market Watch and First Look are quarterly reports focused on the market activity of PC graphics controllers for mobile and desktop computing.

Damn, ExtremeTech for even including him. You can't trust anybody.
:twisted:

 

[turpit]

You guys should all go and join Bear-Stearns. You're wasting your financial acumen here.

Even Mercury Research knows less about the industry than Forum members.
8O

Even though you're attempting to be facetiuos, you are probably correct. I would say a good number of people in here know more about the industry than some guy who goes to work at 9 in the AM, reads a few reports on some product/line, plays with his calculator, scribbles of a quick article, then goes golfing with the boss at noon.

BTW, arent you the one who lambastes any analysts who are negative about AMD?

Is that the metric by which you test an analysists competency? Bullish on AMD..hes OK, Bearish on AMD...hes clueless?

 

[dragonsprayer]

AMD needs to sell some stock this will lower the price but it will raise capital - they are hoping that the banks will cover their capital drain.

As they change over to 65nm parts their costs will go down,

selling some stock would be a good move, or some nice highe end bonds - the ones that convert to stock would sell nicely. convertible preferred shares would also sell well.

in the end amd will be fine - the problem is they are a bargain like their chips and someone (say ibm) would buy them for the sales chain for their market. getting ati with amds marker share would be a good investment for an ibm.

Can you say ibmdti say ibm pause dti or Bamti

Yeah, I don't think he liked Cramer's take:

'Advanced Micro Devices (NYSE: AMD - News): 'I've got to take the extraordinary step of pressing every single bad button there is! Sell, sell, sell! The house of pain... There is no reason for AMD to live! It has no purpose! It has nothing going for it! If you're in AMD, I give you permission right now to leave, and sell that stock!'

cramers claim to fame is 24% track record - made mostly off intel

you could have beat cramer by taking your money out of the bank 3 years ago after sat for 7 years and buying google. or shorting the big nasdeq fav's like cmgi at $150 that $1

cramer is good but hes no different then any other tv person or investor guru if he really new how to make money he make money for living and not give advice and have website and a tv program!

 

[ElMoIsEviL]

This wasn't from mercury research the above comment was from Jon Peddie of Jon Peddie research (whoever he is) and I would harldly call him the horses mouth.

The truth of the matter is that AMD is in the doghouse financially. They tried to do too much too fast and are now paying dearly for it. Cutting capex is not the answer to staying competitive with intel long term. Each process node gets ever more expensive. If you get too far behind on process tech when you are up against intel you are screwed.

Also we can't forget about intel's very agressive upcoming pricecuts. They are already selling their flagship X2 6000 for under $300 and K10 is 2 - 3 quarters too late to save them.

I don't think chapter 11 is definite at this point, but it is a very real possiblity. I say greater than 50% chance they do chapter 11 and recapitalize. At some point if things don't turn soon, it would be in their best interest.

i think your avatar symbolizes your desire to bait and not DEBATE. Peddie works for Mercury Research. Are you obtuse and lacking in reading skills? It was only 3 pages.


I mean I even HIGHLIGHTED their opinion about CH11.

I guess DOOM and GLOOM is all you can muster.

Jogn Peddie does not work for Mercury Research.

John Peddie Research

Small unknown business.

Small unknown businesses do not get interviewed for major online publications.


I guess I have to say I'm spreading FUD rather than reading about too much of this stuff along with my other 3 jobs. I don't know why I hear his name along with Mercury Research.

Dr. Jon Peddie has been active in the graphics and multimedia fields for more than 30 years. Jon Peddie Research is a technically oriented multimedia and graphics research and consulting firm. Based in Tiburon, California, JPR provides consulting, research, and other specialized services to technology companies, including graphics development, multimedia for professional applications and consumer electronics, high-end computing, and Internet-access product development. Jon Peddie's Market Watch and First Look are quarterly reports focused on the market activity of PC graphics controllers for mobile and desktop computing.

Damn, ExtremeTech for even including him. You can't trust anybody.
:twisted:

It's a small personal business. Not a big name like Mercury research. Also his views tend to ALWAYS be pro-AMD and he's ALWAYS wrong.

 

[Slobogob]

I don't understand your reference to the automobile industry. I never made mention of it...

That´s wrong. In your original post you quoted:

"They really went out and took too much share too quickly – they tried to get too big too fast," he said. "If you look at other major share battles – like Toyota's market share in the U.S. – most companies take it very slowly. They [Toyota] took 10 years to double their share. If AMD had taken the same approach, they might be in a very different position today."

Anyways, the growth that you called risky was actually foolish. Alongside the other fundamental mistakes they made, this should cost the top brass their jobs. No, if they had only made one mistake, they should not lose their jobs, but making three major mistakes and possibly permanently hurting the company should lead to dismissal.

Read the article, the analysts are clear on what mistakes AMD made and most, if not all, of these could have been prevented.

Most things could´ve been prevented. In hindsight. Apart from the total lack of marketing i don´t really see any grave mistakes.

 

[turpit]

Hey Baron --

What gives?
http://www.pricegrabber.com/p__AMD_Athlon_64_FX_60_Dual_Core_Processor,__16020345/search=fx+60/mode=g_us_e_s/skd=1

How can they get away with this, a 6000+ is only $239

Its all part of Richard's master plan. They are going to force Intel to collapse by making Ortellini laugh himself to death.


Honestly though, I still stand by the notion that AMD is doing what it believes it has to, to to hold on to marketshare. The question is: will it be enough after the 22nd?

 

[1Tanker]

there will be no chapter 11
amd will be bought out before that could happen
unless they screw up and are not allowed on the stock market anymore

You mean if Intel pulls some strings, and has them ejected from Wall Street?

 

[BaronMatrix]

Hey Baron --

What gives?
http://www.pricegrabber.com/p__AMD_Athlon_64_FX_60_Dual_Core_Processor,__16020345/search=fx+60/mode=g_us_e_s/skd=1

How can they get away with this, a 6000+ is only $239

I guess the extra $150 is for the unlocked multiplier.

 

[InteliotInside]

Hey Baron --

What gives?
http://www.pricegrabber.com/p__AMD_Athlon_64_FX_60_Dual_Core_Processor,__16020345/search=fx+60/mode=g_us_e_s/skd=1

How can they get away with this, a 6000+ is only $239

I guess the extra $150 is for the unlocked multiplier.

I've seen a few on your posts here faming Intel for keeping the price of the Pentium Extreme Edition 965 at $900. But now, you've just explained, perfectly, the reason behind Intel's decision.

I think that's what JJ wants you to see.

 

[BaronMatrix]

You guys should all go and join Bear-Stearns. You're wasting your financial acumen here.

Even Mercury Research knows less about the industry than Forum members.
8O

Even though you're attempting to be facetiuos, you are probably correct. I would say a good number of people in here know more about the industry than some guy who goes to work at 9 in the AM, reads a few reports on some product/line, plays with his calculator, scribbles of a quick article, then goes golfing with the boss at noon.

BTW, arent you the one who lambastes any analysts who are negative about AMD?

Is that the metric by which you test an analysists competency? Bullish on AMD..hes OK, Bearish on AMD...hes clueless?


I base it on whether or not it's reasonable. If they say something negative that is true, then that's it, but too many analysts base their words on Intel not AMD.

 

[BaronMatrix]

Hey Baron --

What gives?
http://www.pricegrabber.com/p__AMD_Athlon_64_FX_60_Dual_Core_Processor,__16020345/search=fx+60/mode=g_us_e_s/skd=1

How can they get away with this, a 6000+ is only $239

I guess the extra $150 is for the unlocked multiplier.

I've seen a few on your posts here faming Intel for keeping the price of the Pentium Extreme Edition 965 at $900. But now, you've just explained, perfectly, the reason behind Intel's decision.

I think that's what JJ wants you to see.


But the perf difference between 6000+ and FX62 is much smaller than E6600 and 965EE while the price difference is much greater.

 

[r0ck]

Does anyone want a 965EE? Then what are you babbling about?

 

[1Tanker]

Does anyone want a 965EE? Then what are you babbling about?

He's gotta feed that ego. It's got a ravenous appetite.

 

[JCon]

Most things could´ve been prevented. In hindsight. Apart from the total lack of marketing i don´t really see any grave mistakes.

Yes, you could have prevented all of this. The growth was a mistake. The OEM contracts were a mistake, marketing was a mistake.

This is what GOOD CEO's do. That's what good companies do. AMD needs to replace the execs, they have crippled AMD. NO ONE in their right mind is buying AMD stock right now.

As for the car industry... I apologize, I thought I used that analogy in another thread. Anyhow, I think that it still stands. You simply can't try to crush a competitor that is far larger than you and has much much more experience. You need to build credibility by making quality products and smart business decisions, and AMD failed to do the latter...

 

[gr8mikey]

But the perf difference between 6000+ and FX62 is much smaller than E6600 and 965EE while the price difference is much greater.

Same old 965EE argument, eh? FYI newegg has not gotten these back in stock since they ran out several months ago.

 

[sailer]

Hey Baron --

What gives?
http://www.pricegrabber.com/p__AMD_Athlon_64_FX_60_Dual_Core_Processor,__16020345/search=fx+60/mode=g_us_e_s/skd=1

How can they get away with this, a 6000+ is only $239

I guess the extra $150 is for the unlocked multiplier.

And that is a thing that really gripes me. It also doesn't matter whether its AMD making a cpu or Intel. When the internal construction of different numbered cpus is the same, with only the multiplier changed, then the cost to the company is also the same, so the company (AMD in this case) is ripping off the customer. Show me real differences in the various chips, transistor counts, cache sizes, etc, and I can understand and put up with price differences. When the price difference is only based on the multiplier, I only see the rip off of the unknowing consumer, which includes myself at one time.

 

[dasickninja]

You're forgetting about the binning. Higher binned chips have more potential, and can withstand harder working conditions. Look at the 30XX Xeons compared to the counterpart E6X00 Core 2's. Technically they are the same chip, but the Xeon is often $20 - 50 more. You pay, not only for the name, but for the binning. The Xeons 30X0 will withstand more than a similar Core 2.