Fri, Feb. 6, 3:54 PM
- After rising 16% yesterday and 48% since Jan. 20 (aided by M&A rumors and a positive Barron's piece), AMD has reversed course. Today's move comes on volume of 35.1M shares, more than twice a 3-month daily average of 17.3M. 73.1M changed hands yesterday.
- A huge short interest is likely contributing to the volatility: AMD had 132.7M shares (21% of its float) shorted as of Jan. 15.
Mon, Feb. 2, 2:17 PM
- AMD is making "real progress" in its efforts to offset declining PC CPU/GPU sales by growing sales of embedded/custom processors, declares Barron's in a positive weekend piece.
- The paper also highlights new CEO Lisa Su's cost-cutting efforts, and quotes Ascendiant Capital's Cody Acree as arguing AMD is winning back significant GPU share from Nvidia (NVDA +1.1%). Acree adds AMD has grabbed enterprise PC design win share that hasn't yet translated into revenue.
- Jon Peddie Research estimates AMD's PC GPU share fell 5.8% Y/Y in Q3 to 14.1%, and that Nvidia's share fell 1.6% to 14.1%. Intel's (NASDAQ:INTC) share is estimated to have risen 7.5% to 71.8%, thanks to rising sales of CPUs with integrated GPUs.
- Barron's does caution AMD's long-term debt load ($2.2B) now exceeds its market cap. But it also points out most of the debt doesn't mature before 2019, and that the company has $1B+ in cash/equivalents and a $400M credit facility to help pay its bills in the near-term.
Tue, Jan. 27, 1:05 PM
- Though Intel and several other PC-exposed names have been hammered by Microsoft's calendar Q4 Windows numbers, heavily-shorted AMD (AMD +4.6%) is adding to the Monday gains it saw on a rumor Chinese chipmaker BLX is looking to acquire the company.
- Analyst reactions to the rumor have been mixed. Bernstein is skeptical CEO Lisa Su would agree to a sale so quickly after taking over, and notes Intel's x86 instruction set license to AMD doesn't transfer under a change of control. MKM notes the Chinese government has been looking to grow its chip IP, but isn't sure "AMD’s product capabilities are worthwhile at the moment."
- Nomura observes AMD partnered with BLX back in 2003, and argues the company's IP and talent could appeal to a Chinese buyer. "We believe AMD's know-how in servers and GPU technology (for supercomputing and HPC) could be of great interest to China, which has been trying to develop these technologies internally for years."
- Shares +11% over the last two days. Any attempted acquisition of AMD by a Chinese firm would likely be closely scrutinized by U.S. regulators.
Mon, Jan. 26, 12:03 PM
- A Chinese media rumor that local CPU vendor BLX IC Design Co. is looking to acquire AMD (AMD +4.5%) has given a lift to the beaten-down chipmaker's shares. It doesn't hurt that 129.2M shares (20% of the float) were shorted as of Dec. 31.
- Thanks to low expectations, AMD rallied last week in spite of providing soft Q1 guidance to go with a slight Q4 EPS miss. Today's gains come as Intel sells off due to Seagate's light Q1 guidance.
- Update (3:08PM): Bernstein's Stacy Rasgon is skeptical about the rumor. Among other things, he notes Intel's x86 instruction set license to AMD "does not transfer under a change of control." AMD is now up 6.7%.
Tue, Jan. 20, 4:53 PM
- AMD expects Q1 revenue to be down 15% Q/Q (+/- 3%). At the midpoint, that implies revenue of $1.05B, well below a $1.2B consensus. But with shares having made fresh 52-week lows earlier today - they closed regular trading down 6.3% - investors are cutting the company some slack.
- Q4 computing/graphics (PC CPU/GPU) sales -25% Y/Y to $662M (share loss), with an op. loss of $56M. Enterprise, embedded, and semi-custom sales -17% to $577M (lower console-related shipments), with an op. profit of $109M.
- Gross margin fell 100 bps Q/Q and Y/Y to 34%. Thanks to job cuts, R&D spend fell 19% Y/Y to $238M, and MG&A spend 15% to $144M. Free cash flow was $94M.
- AMD ended Q4 with $1.04B in cash/marketable securities, and $2.21B in debt.
- Q4 results, PR, CFO commentary (.pdf)
Tue, Jan. 20, 4:17 PM| 37 Comments
Mon, Jan. 19, 5:35 PM
Fri, Jan. 16, 12:43 PM
- Intel (INTC -0.4%) is off fractionally after providing in-line revenue guidance and a soft gross margin forecast to go with a Q4 beat. Charter Equity has downgraded to Market Perform, and Stifel (Buy) has upped its target by $2 to $41.
- Not surprisingly, bulls are focusing heavily on the 25% Y/Y growth posted by Intel's server CPU unit (DCG). Jefferies: "To say DCG is a hidden gem is an understatement ... all four segments (Enterprise, Cloud, High-Performance Computing, Networking) posted growth. We think Intel’s new server cycle (Grantley) helps in 2015, but view drivers in DCG to be largely secular."
- Also going over well: Intel's 2014 capex ($10.1B) was below prior guidance of $10.5B-$11.5B, and its 2015 guidance midpoint is only at $10B. Wells Fargo observes the 2014/2015 figures are below 2011-2013 levels of $10.7B-$11B, even though "2015 revenue that is likely to be substantially higher than in any of these years."
- Those less positive often highlight slowing PC CPU growth. Ascendiant Capital thinks Q4 PC CPU division revenue ($8.9B, +3%) fell short of a $9.2B consensus. "It looks as though the upgrade cycle is tapering off and we expect a return of a secular declining PC market in 2015." Bernstein, reiterating inventory concerns: "Intel’s [PC] unit shipments still remain well above market data on a YoY basis, and account receivable DSOs increased sharply."
- Intel has guided for PC division sales to fall by a low-single digit % in 2015, following a strong 2014 boosted by an inventory refresh and share gains against AMD (AMD -4.2%). AMD, which reports on Jan. 20, is selling off today.
- On the CC (transcript) CEO Brian Krzanich stated Intel shipped 46M tablet CPUs in 2014, beating a goal of 40M, and that the company is committed to driving out $800M in mobile chip unit costs in 2015. Thanks in large part to heavy marketing subsidies, the unit posted a $4.2B 2014 op. loss.
- Prior Intel earnings coverage
- Update: With the help of a tech rally, Intel closed up 0.7%. AMD closed down 5.2%.
Mon, Jan. 12, 6:55 PM
- John Byrne, named the GM of AMD's Computing and Graphics Business Group only last June, is leaving to "pursue other opportunities." Two other execs - chief strategy officer Raj Naik and chief marketing officer Colette LaForce - are also leaving.
- CEO Lisa Su will handle Byrne's job until a replacement is found. His division covers "AMD’s client, consumer graphics and professional graphics businesses, as well as their related product engineering and sales functions."
- Su has been busy putting her mark on AMD since becoming CEO in early October. Job cuts were announced on Oct. 16, and a new operations chief was named last month.
Mon, Jan. 12, 5:58 PM
- IDC estimates global PC shipments fell 2.4% Y/Y in Q4 to 80.8M - a bigger decline than Q3 and Q2's 1.7%, but better than expectations for a 4.8% drop. Gartner is more positive, estimating shipments rose 1% to 83.7M.
- Both firms observe emerging markets, where tablet cannibalization remains a major issue, remain in worse shape than developed markets. IDC also states commercial PC demand (boosted earlier this year by MSFT's ending of Win. XP support) has slowed, and that "market progress has been fueled by low-priced systems, including growth of Chromebooks and [Microsoft's] promotion of Windows 8 + Bing."
- On the bright side, both IDC and Gartner report Asia-Pac returned to positive growth, and that broader consumer demand is gradually improving. The U.S. consumer market is expected to return to positive growth in 2015, aided by slowing tablet demand and the Windows 10 launch.
- IDC believes all top-5 vendors gained share from rivals with less scale. A quarter after cracking the top-5 for the first time with a 6.3% share, Apple's (NASDAQ:AAPL) unit share is believed to have risen to 7.1% (+130 bps Y/Y) on the back of 4.9M shipments (+18.9%). Given higher ASPs, revenue share might be around 15%.
- Market leader Lenovo's (OTCPK:LNVGY) share rose 140 bps to 19.9%; #2 HP's (NYSE:HPQ) rose 300 bps to 19.7%; #3 Dell's rose 140 bps to 13.5%; #4 Acer's (OTC:ASIYF) rose 40 bps to 7.7%. Non-top 5 firms saw their share drop 740 bps to 32.2%, with their shipments declining 20.7%.
- Intel (NASDAQ:INTC), which tends to have good visibility into industry demand, reports on Thursday.
- Related tickers: AMD, NVDA, STX, WDC, HTCH
Mon, Jan. 5, 10:32 PM
- Cumulative PS4 sales were above 18.5M as of yesterday, Sony (NYSE:SNE) discloses at CES. That means 5M units have been sold since the end of October, when sales stood at 13.5M.
- Xbox One sales, for reference, stood at 10M in November. Microsoft slashed prices by $50 in early November in an attempt to boost holiday season demand.
- Around the time of the PS4's launch, IHS estimated CPU/GPU supplier AMD received $100 per PS4 shipment. Today's price might be lower, given chip ASPs typically drop over the sales life of a console. Regardless, with AMD's Q4 revenue consensus only at $1.24B (-22% Y/Y), it's likely quite happy to hear Sony's sales figure.
- Also: 1) Sony has refreshed its Android Wear-based SmartWatch 3 (launched in September), providing it with a stainless steel body. The watch's display and processor remain the same. 2) Sony states all of its 2015 Bravia TV models will run on Google's recently-launched Android TV platform.
- Prior CES coverage
Mon, Jan. 5, 12:17 PM
- Four months after launching its first 14nm Broadwell CPUs - the ultrabook/tablet-focused Core M line, also known as Broadwell-Y - Intel (INTC -0.5%) has rolled out over a dozen CPUs based on its Broadwell-U architecture, which targets mainstream notebooks and smaller desktops. Plenty of products featuring the chips should be shown off at CES.
- The dual-core CPUs will be sold under the Celeron, Pentium, and Core i3/i5/i7 labels, and (naturally) come with integrated GPUs. Most have an official max power draw (TDP) of 15W, but a handful have 28W TDPs and also come with relatively powerful Iris 6100 GPUs. The Core M line can deliver sub-5W TDPs.
- Intel claims a Core i7 Broadwell-U CPU can respectively deliver 22% and 50% increases in 3D graphics and video conversion performance over a comparable 22nm Haswell CPU, and (perhaps more notably) up to a 1.5-hour increase in battery life. Quad-core Broadwell parts aimed at tower desktops and high-end notebooks aren't expected until mid-2015.
- Rival AMD's (AMD -1.1%) most advanced PC CPU lines still rely on 28nm processes; the company has promised 20nm parts will arrive later this year.
- The launch comes as MKM makes a belated upgrade to Buy, and hikes its target by $5 to $45. "We likely kept our neutral rating (with positive bias) for too long as PCs stabilized, data center improved, and INTC demonstrated a flexible approach to succeed in tablets and access existing China consumer channels."
- MKM is also upbeat about server CPU demand, given new product cycles and strong cloud and big data-related demand. Intel has forecast its server CPU division sales will rise at a 15% annual clip through 2018. PC CPU division sales are expected to fall slightly in 2015, following a strong 2014.
- Also: Intel has bought a 30% stake in smart glasses maker Vuzix for $24.8M. The investment follows an alliance with eyewear giant Luxottica, and a WSJ report that the next version of Google Glass will sport an Intel CPU.
Dec. 15, 2014, 5:01 PM
- James A. Clifford, until now RF Micro's (NASDAQ:RFMD) VP of global sourcing and foundry tech, has been hired by AMD to be its SVP of global operations. The job puts him in charge of "all aspects of AMD's end-to-end manufacturing and supply chain strategy."
- Clifford, 69, spent less than two years at RF Micro. He previously spent 17 years in executive roles at Qualcomm, and 20 before that at Unisys.
- The appointment comes two months after AMD named Lisa Su, who for a short while was the chipmaker's COO, its CEO. AMD hasn't named a COO to replace Su.
Dec. 9, 2014, 4:49 PM
Dec. 8, 2014, 4:00 PM
- AMD (AMD -3.4%) is now down 34% in a year has seen PC CPU share losses to Intel and concerns about console APU margins exact a heavy toll. After factoring net debt, the chipmaker trades for a mere 0.8x 2015E sales.
- Some bulls have been upbeat about the potential of AMD's upcoming next-gen flagship GPU (codenamed Captain Jack) to help it regain high-end GPU share, after leaked benchmarks showed it outperforming Nvidia's recently-launched GTX 980.
Nov. 13, 2014, 8:37 AM
- The WSJ reports Microsoft (NASDAQ:MSFT) has reached a deal to buy Israeli cybersecurity/identity-protection software firm Aorato for ~$200M, and plans to announce it today. The paper reported in July a deal was close.
- Aorato's products complement Microsoft's Active Directory enterprise authentication/ID-management software service, since they analyze Active Directory interactions to create user profiles and detect suspicious activity. There could also be synergies with the cloud-based Azure Active Directory service.
- In its latest effort to grow its developer base (previous) and support rival platforms, Microsoft is open-sourcing the server stack for its.NET software framework (underpins many Windows apps), and allowing developers to write server/cloud-based .NET apps for Linux and Mac OS. The move could help .NET better compete against alternatives such as Ruby on Rails and PHP.
- Microsoft has also: 1) Launched a free version of its mainstay Visual Studio 2013 app development suite for non-enterprise users. 2) Previewed Visual Studio 2015, which the company says is "built from the ground up with support for iOS, Android and Windows."
- Microsoft says it will "shortly" reach 10M Xbox One sales, and that sales have tripled since a $50 price cut went into effect on Nov. 2. The latest figures still leaves the One's total sales behind the 13.5M seen by the PS4 as of the end of Q3.
- The pickup in Xbox One sales is a positive for CPU/GPU supplier AMD, which was estimated by IHS last year to receive $110 per unit.
- Update: Microsoft has confirmed the Aorato acquisition. "We are making this acquisition to give customers a new level of protection against threats through better visibility into their identity infrastructure."
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