Official AMD Q1 Earnings Thread -

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Red Sky, agree.
To quote Doug Freedman ( Amer. Tech Research) " They're just seeing the headlight of the train. It hasn't even hit them yet.

The late bounce could be a dead man bounce believing that AMD is a buy out canidate taking it private.

Real test will not be the small buy/sells this AM but what the institutional buyers do during the 1st hour of trading tomarrow
 
Red Sky, agree.
To quote Doug Freedman ( Amer. Tech Research) " They're just seeing the headlight of the train. It hasn't even hit them yet.

The late bounce could be a dead man bounce believing that AMD is a buy out canidate taking it private.

Real test will not be the small buy/sells this AM but what the institutional buyers do during the 1st hour of trading tomarrow
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Does anyone know if institutional investors do after hours, or could this have been driven by daytraders??

I have seen wild A$$ after hour activity and it is no indication of opening day next day in most cases ... but it was weird to see it pop up above 15 when the company just posted one of it's worst quarterly earnings in it's history -- I believe Q4 2002 was the worst at 854 million loss.

It is my understanding that no after hours trades actually hit the market (hence after hours), but that people continue to ask/bid and they accept the contracts which are then executed at the opening bell in the morning. So it is possible institutional investors participate in after hours trading, but I would suspect in AMD's case they will wait for the shell shock to hit in the morning once the bell rings and attempt to get the stock as cheap as they can assuming they want it at all.

Typically, from what I have seen, the next morning stocks open lower than their after hours trading price.

I am not 100% sure on the inner workings of after-hours trading, so take my comments with a small grain of salt.
 
Hey, would you mind commenting on AMD's Q2 guidance.... it seems rather ludicrous to me...

YoY, Q1 was a stellar quarter in 2006, they guided flat to Q2 (just like today), but registered a more seasonal 9% decline:
http://www.tgdaily.com/content/view/27436/118/

Do you find it reasonable that AMD's guidance is accurate??

Considering that thy have either misguided or warned in some fashion Q2 06 to present.

Jack
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That was interesting to me as well (and it was the source of one analyst's questions in the CC). Intel, which will either hold MSS or gain MSS in Q2 says that they will be down QoQ as is typical for Q2. AMD's only response that I could tell was that they think they abused the Channel badly by playing with Dell and now that Dell can't sell their goods, they have enough to flood the Channel (especially if they price low) in Q2. I think it's just optimistic though, but we'll see.

Barcy's not going to have any impact on earnings in Q2 for sure. Q3 it may just adjust contracts slightly as I can't see the actual product being in customer hands until EOQ Q3 at best. Their Q2 predictions seem to be aimed to letting execs offload shares before the steep drop.

They sounded surprisingly optimistic and even threw barbs at Intel "Our competitor tried every effort to maintain their monopoly" (or something to that effect). They're two bad quarters away from emergency money problems IMO. This is will be a very dangerous time. With Intel having cleared P4 inventories, I would expect prices to fall again to put extra pressure on AMD. 28% GPM is pathetic in this industry.
 
Hey, would you mind commenting on AMD's Q2 guidance.... it seems rather ludicrous to me...

YoY, Q1 was a stellar quarter in 2006, they guided flat to Q2 (just like today), but registered a more seasonal 9% decline:
http://www.tgdaily.com/content/view/27436/118/

Do you find it reasonable that AMD's guidance is accurate??

Considering that thy have either misguided or warned in some fashion Q2 06 to present.

Jack
Click to expand...

I think AMD is trying to remain positive and head off a fire-sale of their stock. Do I think their guidance is reasonable? No, but do I think they will post numbers far below their guidance? No. I think the R600 (if it holds to AMD's claim of a hard launch and in May) will lift AMD's numbers. They commented in the conference call that ATI division revenues were actually up 19% I think, so the GPU business is doing its part. I expect the R600 to launch on time (by on time I mean May, not they should have launched it 6 months ago) giving them 1 solid month of sales and push in OEM channels.

Based on what AMD management said and the seasonableness of Q2, I would peg their revenues a hair over 1B, not the 1.3B ish AMD projects, but that won't translate well into GP due to their fixed cost structure. I would expect their GM to stay about the same, maybe broach 30% if they can get some stability in prices (which is likely).

I think AMD has reached a point where they have to stop dropping prices, it is just killing them. I know they said sequential shipments are more to blame than ASP, but it sure as hell doesn't help matters. Sequential shipments will probably take a hit due to Intel's price drop and new product intro's, even if they are minor improvements.
 
If Q2 really will be worse than Q1, how long can AMD realistically sustain such massive losses without going under?

I expect better results once Barcelona/Agena and R600 are out, but even then before volume is reached AMD would still be losing money IMO. I would be VERY surprised if they manage to get back in the black before 2008...
 
I have only read over your summary of the CC -- but I am not too surprised... AMD is the slickest when it comes to song and dances. I find it somewhat humorous that the financial community swallows it most every time.
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I guess it is like some women... they just enjoy it. 8O

Realistically they like the competition AMD brings because it forces Intel to keep moving though.
 
If Q2 really will be worse than Q1, how long can AMD realistically sustain such massive losses without going under?

I expect better results once Barcelona/Agena and R600 are out, but even then before volume is reached AMD would still be losing money IMO. I would be VERY surprised if they manage to get back in the black before 2008...
Click to expand...

Analyst predictions don't have them in the black until 2009 and that is an aggressive estimate at this point.
 
If Q2 really will be worse than Q1, how long can AMD realistically sustain such massive losses without going under?

I expect better results once Barcelona/Agena and R600 are out, but even then before volume is reached AMD would still be losing money IMO. I would be VERY surprised if they manage to get back in the black before 2008...
Click to expand...

Analyst predictions don't have them in the black until 2009 and that is an aggressive estimate at this point.

Wow. Really? 2009. I figured they would push near black near the end of Q3/Q4, and maybe be in better shape come Q2 2008, once their volume of K10 is more stable.

2009 wasn't even something I would've guessed.
 
If Q2 really will be worse than Q1, how long can AMD realistically sustain such massive losses without going under?

I expect better results once Barcelona/Agena and R600 are out, but even then before volume is reached AMD would still be losing money IMO. I would be VERY surprised if they manage to get back in the black before 2008...
Click to expand...

Analyst predictions don't have them in the black until 2009 and that is an aggressive estimate at this point.

Shiznitz, that's not good. 🙁
 
If Q2 really will be worse than Q1, how long can AMD realistically sustain such massive losses without going under?

I expect better results once Barcelona/Agena and R600 are out, but even then before volume is reached AMD would still be losing money IMO. I would be VERY surprised if they manage to get back in the black before 2008...
Click to expand...

Analyst predictions don't have them in the black until 2009 and that is an aggressive estimate at this point.

Shiznitz, that's not good. 🙁

I believe I left out some info accidentally, that was an annual profit in 2009. Quarterly profit will likely be 2008, as yall have said.

Estimates (Dec)
(US$) || 2005A ||2006A || 2007E || 2008E || 2009
EPS || 0.40 || (0.32) || (2.10) || (1.07) || NA
GAAP EPS || 0.40 ||(0.32) || (2.10) || (1.07) || NA
EPS Change (YoY) ||60.0% ||NM ||- 556.3% || 49.0% || NA
Consensus EPS ||(1.16) (2007)|| (0.14) (2008) || 0.09 (2009)
Click to expand...
 
If Q2 really will be worse than Q1, how long can AMD realistically sustain such massive losses without going under?

I expect better results once Barcelona/Agena and R600 are out, but even then before volume is reached AMD would still be losing money IMO. I would be VERY surprised if they manage to get back in the black before 2008...
Click to expand...

Analyst predictions don't have them in the black until 2009 and that is an aggressive estimate at this point.

Wow. Really? 2009. I figured they would push near black near the end of Q3/Q4, and maybe be in better shape come Q2 2008, once their volume of K10 is more stable.

2009 wasn't even something I would've guessed.

Q2 will be the worst of it.... Q3 will be in the red as well.... as for Q4?? Break even to slightly postive.

I have seen some commentary that AMD is expected to lose in excess of 1.5 Billion for FY 2007.

What if, as you predicted, Penryn is released in Q4 and outperforms Agena on the desktop? Would AMD still be able to break even/book a small profit in that case?

It seems to me the main source of AMD's financial woes right now is low ASPs and margins. If they can't compete on the desktop (such as right now) then we are back to square one of using the oldest trick in the book - cutting prices to compete.

Sure, R600 will be competitive with nVidia, and Barcelona will probably rule the server sector, but the desktop is by far the most important market to be competitive in as far as revenues and margins are concerned. If AMD fails on the desktop, I fail to see how they can have any hope of breaking even.

Looking back at recent history, the only time AMD suffered massive losses like they are today was when their Athlon XPs were getting hammered by Northwood P4s.

They were profitable once K8 reached volume and outperformed P4s, however, it is a vastly different ballgame this time. Netburst was a monumental mistake by Intel but now with Penryn and Nehalem in the works I just don't see AMD having anywhere near the dominance they had over the P4 the past 3 years.
 
Honestly, AMD doesn't have to take the performance crown to get profitable, they just have to match Intel which they can't do at the current price/performance points. If AMD can get within a few percentage points of Intel's top dawg, then I will call that a win for AMD.

Where AMD is going to run into problems with ASPs even more so than the desktop segment is the mobile segment. Turion just can't keep pace with Intel's Centrino platform, which is due for yet another update soon, but Turion isn't due for an update till H1 of 08. The reason is desktop sales in 07 were up~3% but notebook sales were up nearly 30% reflecting the shift towards portability.

With notebooks having enough power for users to do anything they want (we all should be able to concede that the vast majority of users don't game/encode/render like THG people do) they don't mind paying a decreasing premium for the portability of a notebook. AMD really needs to improve their offering in the mobile segment because right now... frankly, it blows.
 
I am just going by historical trends here - it is a mere coincidence that the last time AMD suffered huge losses in revenue, ASPs and marketshare was when they were uncompetitive performance wise, during the Northwood P4 vs Athlon XP era?

Is it a mere coincidence that during the time K8 was ahead of P4 (2003 - 2006) that AMD booked record profits and reached all time highs in their stock value?

Is it a mere coincidence that their downturn in profits coincides directly with the launch and ramping of C2D?

This is only my opinion, and I hope I am wrong, but I believe AMD has to surpass, not match or 'come close' to Intel in performance if they wish to be profitable like they had been during the K8 heyday.

I just don't see that happening - I don't believe AMD has the resources or finances to battle a giant like Intel on the performance front, especially now that Intel is committed to the 2 year 'tick tock' development schedule.

Luckily for AMD, the market is moving towards mobile products at a rapid rate, and the need for pure CPU performance is not as important as years gone by.

The only way for AMD to win the battle for survival in the wake of Intel is to fight a different war, which I guess is why they acquired ATI and have great hopes on Fusion.
 
The only way for AMD to win the battle for survival in the wake of Intel is to fight a different war, which I guess is why they acquired ATI and have great hopes on Fusion.
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I agree the historical trend isn't in their favor. However, if AMD can beat Intel at certain price points and make the top end at least competitive, they can remain profitable.

Back to your last point, I agree. My only qualm with this strategy is once Intel turns to corner to match this long term strategy (if they haven't already), they can do it in absolute record time. What would take AMD 18 months might take Intel 6 months, lol (exaggerating of course).

time will tell, at this point it is all personal opinions and conjecture. :)
 
The only way for AMD to win the battle for survival in the wake of Intel is to fight a different war, which I guess is why they acquired ATI and have great hopes on Fusion.
Click to expand...

I agree the historical trend isn't in their favor. However, if AMD can beat Intel at certain price points and make the top end at least competitive, they can remain profitable.

Back to your last point, I agree. My only qualm with this strategy is once Intel turns to corner to match this long term strategy (if they haven't already), they can do it in absolute record time. What would take AMD 18 months might take Intel 6 months, lol (exaggerating of course).

time will tell, at this point it is all personal opinions and conjecture. :)I'm sure that's all that's going around in the AMD board meetings too. :)
 
Well i did say dont worry about the bad news today, even if it was worse than expected, as far as the stock is concerned its about the future earnings, which may or may not be better but "sounds" ok.
We will find out about a lot of new stuff coming out soon so i expect the stock to gain a buck or two before nexted Q. It will be a bumby road but thats when i trade best, i dont know about AMD but im in the $GREEN$

Told u to buy it at $13.0ish
Mind you when trading was halted i expected shit to hit the fan and it did for 3.5 seconds when it tanked to $12.99 but it poped to $15.ish. wish i sold before market closed and had some buy orders in for after hrs.
o well tomorrow is another day.
Good luck to all AMD traders.
 
but it poped to $15.ish..
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AMD hasn't been at $15 or above since the first week of March. What you're seeing now in the spike is the Street positioning itself for a private buyout.

Woe be to the lost AMD tribes wandering in the desert on April 23! :lol:
 
Im talking about after hrs trading just b4 i went to bed it was about $14.79 with a hour left of trading to do, someone else posted here that it got to $15.0 which was very possible.
I dont think there will be a private buyout, but who knows.
 
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