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AMD's Q2'14 Earnings:Higher Professional Graphics Share, Increasing Semi-Custom Revenue & New APU Li
- Thread starter Boomstick777
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Soldato
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While it's not good the big thing to look at for me was this time last year revenue was 1.1bil and this year it was 1.43 bil.
From the Ceo
"The second quarter capped off a solid first half of the year for AMD with strong revenue growth and improved financial performance," said Rory Read, AMD president and CEO. "Our transformation strategy is on track and we expect to deliver full year non-GAAP profitability and year-over-year revenue growth. We continue to strengthen our business model and shape AMD into a more agile company offering differentiated solutions for a diverse set of markets."
Caporegime
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LOL,have I walked into Anandtech or Overclock.net forums or something??
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AMD don't pay dividend, their shares are used as short term profiteering, its the same with their share value on every single quarter, a lot of positive articles written in the days leading up to a quarterly submission, the stock shoots up in value, and then fall off a cliff hours after that submission.
Whats happening is people buy masses of AMD shares just before each quarter, Talk it up to increase its value and then cash out once they feel its reached a peak, some of them also talk down the stock in-between to keep it low so they can make more money when it come to buying stock again.
How well or badly AMD are actually doing have nothing at all to do with the value of the stock.
Often when agencies upgrade AMD ratings an army of stock journalism go on the attack in a bid to hold the stock value down, the same people write the most ridiculously optimistic and rosy AMD valuation a few weeks later, as soon a the value reaches a peak they write yet again the most vicious attacks. and so it goes on and on and on.....
This is very good news, as I explained above AMD don't pay dividend, they also don't have any long term investors.
The thing about having long-term investors, especially if you pay them dividend, its them who you exist for, who your trading for.
They always want more, if they don't get more they will not invest, for the company to provide them with more it has to increase its profits continuously.
If it cannot increase its profits by growing as a company it has to reduce costs and or put prices up to increase its margins, eventually it gets to a point where your products and services become to expensive and lesser quality,
In other words your costumers pay more for less so that your investors get more for less, at which point the bubble bursts.
Take Nvidia as an example, how many more fancy names can they come up with to get you to pay twice as much for the same product?
eventually it will get to the point where they just can't sell the products anymore, I mean how much are you willing to pay for a Titan-Z Ultra Supper Dooper, £3000? £4000? £5000????
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You honestly think nVidia will just not sell the products they make?
Your not rushing to buy a Titan-Z, would you buy a Titan-Z Ultra for £4000? how much is too much? is it ever too much?
No because I don't do Cuda intensive work but people do and will/have buy/bought them. OcUK have sold them, so that tells me something.
No doubt they will always sell some, but if your not selling more at the same price then you have to sell them at a higher price, if less buy at the higher price then you have to increase the price more, in turn less buy it. the bubble bursts.
Nvidia are not expanding, so they have to increase the profit margins so they can keep pace or increase payouts to investors, as soon as those payouts start to slip those investors will take their money and invest it where they do get the payouts they want, Intel perhaps, or Apple....
I personally don't care for the Titan Z and even if it was £1200, I still wouldn't be interested. To me, the people who will buy it are those who work with Cuda. There is plenty of people who do and it works out a lot cheaper than a Tesla GPU.
If you take the Tesla K20 for example:
- 2496 CUDA Cores
- 706MHz Core Clock
- 320Bit GDDR5
- 5GB Memory
That costs 3 grand and now when we look at Titan Z
- Cuda Cores: 5760
- Base Clock: 705MHz
- Boost Clock: 876MHz
- Single Precision: 8.1 Teraflops
- Double Precision: 2.3 Teraflops
- Memory Config: 12GB / 768-Bit GDDR5
And that costs 2.4 grand, so a saving of £600 for more horse power.
As for nVidia not expanding, what do you think they spend all those billions on for R&D?
http://ycharts.com/companies/NVDA/r_and_d_expense
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Compare that to AMD's R&D and it is a big decline.
http://ycharts.com/companies/AMD/r_and_d_expense
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R&D spend should result in growth, its why they spend it, its an investment on their part, but it doesn't work like that if it, well, doesn't work.
Nvidia's quarterly revenue is unchanged in the last year, going from the I have figures on in my head, its about $1bn to $1.1bn, AMD's quarterly revenue has increased about 40% in the last year, from about the same as Nvidia, $1.1bn to $1.45bn.
AMD have actually grown in size where as Nvidia have not.
Where Nvidia have been able to keep investors happy is in profit margins, both AMD and Nvidia were at about 30% margins, AMD are now at about 35%, a small increase, Nvidia have almost doubled their margins, to about 55%.
They did that by charging higher prices relative to cost. this is those £850 GTX Titans, £2000 Titan-Z and probably to some extent little higher priced relative to cost right across the range.
Because Nvidia are gaining higher levels of income relative to cost they can keep paying investors what they want.
But, Unless Nvidia can increase sales at this level of profit margin they will have to increase that margin more, which means higher prices, they may be able to keep inching it up like that but eventually the margin to sales ratio will go into reverse.
Removing the DP performance on the GK110 and charging you 'a lot extra' to put it back has worked up to now, but they are going to have to keep coming up with idea's like that to get their user base to pay ever more for what is relatively the same or artificially gimped vs not gimped.
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Nvidia have made big wins in the HPC sector, and have signed up IBM to exclusively use and help develop HPC technology based around their designs. One of the first fruits of this is a brand new high performance GPU interconnect: http://arstechnica.com/information-...e-gpu-interconnect-for-faster-supercomputing/
As we know from the CPU sector. HPC and the ilk are traditionally very high margin areas. One of the reasons Intel are so fantastically profitable is the fact they have the server and HPC market completely sewn up. Given Nvidia are absolutely hammering AMD in this high margin market, it would explain why their margins are so healthy.
As we know from the CPU sector. HPC and the ilk are traditionally very high margin areas. One of the reasons Intel are so fantastically profitable is the fact they have the server and HPC market completely sewn up. Given Nvidia are absolutely hammering AMD in this high margin market, it would explain why their margins are so healthy.
No one is "lambasting" or saying they doing at all "badly" Greg
Figures show what is what and that's the bottom line.
PCPer jumped on this as well and I pulled this quote from there.
So far from looking rosey for AMD and they need to pull the stops out. I have always said we need both companies to do well to keep us fed with what we want (for this section, GPUs). No amount of heads in the sand will make this go away and AMD are making gains but the debt is growing.
On the positive side for AMD,
Fingers crossed they pull a blinder and that sells like hot cakes.
Full article here
LOL! I was thinking the same.
I don't understand how your citing some bad aspects of AMDs quarter relate to you quoting me reassuring you that no one is "as you put it" Lambasting or talking badly about Nvidia.
But its a good point to bring up, so I will take it
I'm in complete agreement with PCper and I assume you, AMD do need to get their debt down some more, I say more because they have already brought it down from $6.5bn two years ago to $2.1bn now. this is the first time its gone up (By 3%) in two years of it going down (By 70%)
Never the less servicing that debt is eating into their profits.
Personally If I was them I would want to bring that debt down a bit more, as a company its much better to have a debt to service than not to keep a credit reference going.
But $2bn is too high, IMO, no more than $1bn for a company of AMD's size.
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