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Friday, Jul 19
With the help of Microsoft and two downgrades, AMD's (AMD -13.6%) post-earnings selloff turned...
With the help of Microsoft and two downgrades, AMD's (AMD -13.6%) post-earnings selloff turned into a rout, as investors decided strong (Xbox One/PS4-fueled) revenue guidance was priced in. There was also disappointment over AMD's guidance for a Q3 gross margin of 36% (below Q2's adjusted 39%), which suggests its console wins literally came at a price. FBR (Outperform) argues long console lifecycles give AMD plenty of time to improve margins. SA contributor Ashraf Eassa is worried about low GPU division margins (attributed to game bundling), and the potential for further PC/server CPU share losses. AMD mentioned on its CC its Q/Q PC CPU unit growth was fueled by its Kabini (ultrabook) and Temash (tablet) platforms. (Q2: I, II)