Entering text into the input field will update the search result below

AMD: Ready For Takeoff

Business Quant profile picture
Business Quant


  • Most of AMD's channel partners under our coverage posted strong sales growth during April.
  • This dispels bearish narratives which suggest that AMD may be hit with a financial slowdown in the near future.
  • Investors should ignore the FUD and remain long on the name.

The bears are having a go at AMD (NASDAQ:AMD) in various investing forums of late. While some believe the chipmaker's sales will be hit during Q2 due to supply chain disruptions, others feel its sales momentum will fade away due to a general slowdown in demand during the currently uncertain economic conditions. But while these may make great catchy headlines, supply chain data says otherwise. AMD's AIB and foundry partners registered robust sales growth during April which comes across as an excellent news for the chipmaker and its shareholders. Let's take a closer look.

(Image source, Image labeled for reuse)

The Data

For starters, AMD is not a vertically integrated business. Its chips are manufactured by foundry partners - such as Taiwan Semiconductors (TSM) - and assembled in the form of usable GPUs by its add-in board partners - such as Gigabyte, MSI, ASRock and TUL Corp. among others. So, tracking their monthly sales figures can provide us with leading insights about the health of AMD's supply chain and its extent of sales during ongoing quarters.

Our monthly revenue tracker at Business Quant, which covers 1300+ firms from various sectors, revealed an interesting trend. As it turns out, five of the six above-mentioned AMD partners saw their sales grow by over 20% during April on a year on year basis. The one that registered a sales decline, TUL Corp, has been struggling with sales in the past several months anyway so we need not relate its financial performance with AMD's.

(Source: Taiwan Sales Tracker)

For the uninitiated, TUL Corp, Gigabyte, ASrock and MSI assemble and sell AMD GPUs under their sub-brands. Although TUL is an exclusive GPU partner with AMD and generates most of its revenues from selling PowerColor GPUs, its larger mentioned peers are diversified firms that manufacture

This article was written by

Business Quant profile picture
Business Quant is a comprehensive investment research platform. It hosts KPI data, financial data and analytical tools to help you become a better investor. You don’t have to go through boring SEC filings to keep a track of AT&T’s subscriber count, Apple’s revenue from iPhones or Disney’s revenue by region. Our Company KPI Data tool does that for you and it does so much more. Get an edge over the market, from day one. Watch Business Quant in action here.

Analyst’s Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

Recommended For You

Comments (145)

wow&wow profile picture
Great AMD Ryzen 4000 laptops with poor displays?

AMD Ryzen 5 4500U Review, Mid-Range Zen 2 Beats Intel's Best

wow&wow profile picture
The Best Cheap Gaming Laptop

The Cheap AMD Ryzen Laptop

Good entry point, no?
Exclusive: Internal Memo Shows Murthy’s Remarks Over Jim Keller’s Departure, Details About New Structuring, Raja Koduri To Head Architectural Roadmap

Man, Raja will drive entire architecture group?
I mean Raja is a brilliant guy but makes me wonder
what sort of engineers Intel has had all these time ?
wow&wow profile picture
"what sort of engineers Intel has had all these time ?"

Those who used the cheap, cheat design approach of using partial addresses!
Jim Keller left Intel rather abruptly. why?
tufttugger profile picture
Saw that. Hope he and his family are (or will be?) ok. Very abrupt.

Still, does not bode well for Intel. We'll see if the magic rubbed off on them and they can hold onto it.
people can finally shut up about Jim Keller being at Intel
We all saw what AMD can do with PS5. What a fine GPU!!! $80 by tomorrow!!!!!
wow&wow profile picture
Do you live in China? :-)
20% correction coming
AMD dropped -6% today
AMD Ryzen 7 4700G ‘Renoir Desktop’ Processors CPUZ With DDR4-5600 RAM Smiles For The Camera

hanglai123 profile picture
AMD at best with a revenue around $1.8B, and a gross margin about 40+%, its growth is negative, and yet the share price is at $50+/share, while its competitor Intel is putting out products better and better than AMD's both in CPU and graphic, one cannot see if this is not speculative, then what it is?
wow&wow profile picture
Stock price being ahead of earning, yes.


Surely not, it takes time to sell the truly competitive products to OEMs and even more time to sell to enterprises.

The key truly competitive products against Intel:

1) EPYC 7002 series (7nm Zen 2), 8/7/2019, less than one year.
2) Ryzen 4000 series APU (7nm Zen 2) for ultra-thin, Q1 2020, now more notebook models showing up.
3) Ryzen 4000 series APU for desktop, likely 10/2020.

AMD certainly has a bright future; it's matter of getting in or getting more at what prices.
AMD has better product and positive growth .... not a very serious comment by you.
sbakhtiar profile picture
Your statement about Intels products being better is incorrect. AMD's Ryzen processors and Zen 3 architecture are light years ahead of Intel. Your statement was true of that last gen stuff.

Infact, Intel, has all but thrown in the town on the next set of processors in the hope that it will catch up on the one after that.

AMD is currently the only manufacture with 7nm chipsets, and a new completely redesigned core that allows for massive amounts of data lanes between the CPU and the PCI busses. The increased the die size, while breaking out components in a why that is shear genius.

I don't want to get much more technical other than that, but the evidence is out, Intel got caught sleep, and AMD just made a huge technological leap right passed them by a few generations.

This is what's got most people excited about the stock. Unfortunately not a lot of people are able to understand the technical details so they continue under the false impression that Intel is still king.

Just do a Youtube search for Intel vs. AMD and see what's happening.
glenart profile picture
This one is a no brainer, folks. I won't argue that AMD is in a solid growth phase right now. I have been in and out of this stock for 20 years. But the fact remains is that AMD like a lot of big tech right now is priced for complete perfection. The forward PE is 54. Any slight failure to live up to complete perfection will mean an immediate 10-25% drop. I am not sold in the least that April sales numbers are repeatable. That was the height of Stay at Home orders around the world. Those orders by now have expired. The captive audience is out and about. Finally short interest is the lowest in 10 years. Aka short covering will not push the stock higher. For these reasons, the short bet on AMD is by far the smarter position. With economic recovery around the world still very iffy, the short thesis becomes even more compelling.
June is going to be strong sales month for the AMD laptops. Anecdotally, in China all the 4000 series AMD models are sold out
Glenart I clicked on your username and looked at some of your past comments, and they seem pretty darn smart.
sbakhtiar profile picture
You're definitely right about the PE. The price right now is assuming Intel is out of gas, and that team Green (NVIDA) and team red (AMD) are going to symbiotically work together to usher in a new age of self driving cars, Pizza Hut dropping drones, and a lot more technology the consumer is demanding. Just look the latest PS5 and XBox.

They both have very complementary technologies that could make this all happen, if they don't eat into each others spaces. The problem is they both have strong showing in the AI and graphics space, and it will be very interesting to see how the relationship pans out.

Make no mistake, AMD was a has been, until Sue took over. She started out on the floor, so she probably understands the production pipeline and what is possible better than anyone in the industry, and her leadership has been what's resurrected AMD from the ashes.

There is also a lot going on with AMD that the PE doesn't talk about too ;)

Frankly when you look at it in comparison to Tesla, I have no idea why it's priced so low.
Short AMD
Many still have no idea how much revenue console, Samsung RDNA, mobile give to AMD. those are billions of dollars soon with that money AMD can accelerate faster than 5 years ago. People not investing in AMD is because afraid of Intel coming back to hunt AMD but it wont! Too much worry leave you no money at the end
wow&wow profile picture
"Many still have no idea how much revenue console, Samsung RDNA, mobile give to AMD."

You still have no idea what numbers the management presented:

~25% for 2020 with a target annual growth of ~20%/year!

Unless you have information that others don't, ...
SmartStops profile picture
AMD has been making amazing strides in the micro processor market for years now, especially after the introduction of the Ryzen line from a few years ago, Glad to see it finally moving up. Just make sure you keep your profits protected with a Smart Trailing Stop approach.
👍 You forgot one major win for AMD It's Nvidia....
Nvidia selected
AMD's Second-Gen EPYC Processors to Power NVIDIA’s new DGX A100 high-performance computing systems and Cloud Systems. I'm not shareholder of AMD only Nvidia but BIG win for AMD. I'll throw you a bone. finance.yahoo.com/...
Yes, AMD can reach over $100 dollars + soon so jump into it without questions. AMD is way undervalued for its future. Nvidia is way overvalued as of now.
Nvidia is valued on the future. They are creating designing now shipping to undefined TAM's
They defined the fourth wave of computing at GTC 2020. An all products are already shipping to Microsoft Amazon, Dell Facebook HPC and others
Go on YouTube search out GTC 2020 Jensen Huang keynote address. It's in 9 separate parts. Make sure you start at Jensen welcome to GTC 2020. Each segment is about 12 minutes long.
You'll understand after watching these 9 segments.
That will surely add a few % in data center share.
@author: "The bears are having a go at AMD in various investing forums of late." Really?

Even if true, AMD has been on a tear. Despite COVID, today's intraday high was almost back to its 52w high, which also figures as its >20y high. Short interest has been shrinking to historically low levels (<5% of float). AMD up, up and away, as long as Lisa Su keeps it at the cutting edge, like she's done over the past 6 years. Sold all INTC 3y ago to buy AMD and glad I did.
Business Quant profile picture
Agreed, hksche2000
Apple is starting to make their own Chips. Doesn't that effect AMD negatively?
AMD could be involved licensing their technology to Apple. Time will tell.
RyzenFan profile picture
Apple moving to Arm CPU only hurts Intel, AMD still need AMD's GPU. Since Apple never used AMD CPU in the past, the move has no effect on AMD.
K12 and Apple some however related I believe AMD helps Apple get their arm chip ready. Apple in no way can make better processor without AMD help
Mike Bruzzone profile picture
AMD division revenue splits are misleading and likely as erroneous historically as Intel CCG/DCG division revenue splits. At AMD, enterprise appears to subsidize GPU division. At INTEL DCG, Xeon subsidizes CCG/PCG.

I expect a robust second half on channels flush with cash from secondary, primarily Intel overage, surplus, deadweight, Xeon laundered inventory managed sell off.

On market share AMD stated server share currently misleads whereas client and GPU are close enough not to raise a discrepancy. AMD Q2 is not the quarter I thought it would be "swinging from vine to vine" suggests back half loaded.

Product and price competition will escalate into the second half of the year.

Easiest way for AMD to increase revenue is to reduce revenue sacrifice associated with sales bundle close inventive.

Mike Bruzzone, Camp Marketing
Sighcopath profile picture
@Mike Bruzzone
What you think about the rumor that AMD is buying up the excess 5 nm wafer supply from TSMC that had been slotted to go to Heiwei (sp)? If true would this put a real crimp on any INTC plans to engage in a price war in servers with AMD, especially if INTC is still stuck on 14 nm +++++ ?
Mike Bruzzone profile picture

Beginning of the year AMD claimed a 30% second half increase in 7 nm availability as Apple moved to 5 nm. I'm waiting for that increase supporting 2020 leadership plan On TSMC withdrawal Huawei 5 nm allocation goes to AMD. certainly AMD can sell evert
Mike Bruzzone profile picture

I've been kicked off the comment line twice now and may have to enter through a different web portal.

Beginning of the year AMD claimed a 30% second half increase in 7 nm availability as Apple and Huawei moved to 5 nm. I'm waiting for that increase supporting 2020 leadership plan. On AMD 30% annual increase will get production into the Intel industrially competitive 55 M to 65 M unit range. However, because AMD 35% annual production volume seen in revenue sacrifice bundled in as sales close incentive, for AMD to make this year's revenue target of $8.076 B (20% CAGR over 2019) to $8.749 B (30% CAGR) actually needs to produce 71 M to 76 M units. So every next available wafer helps.

On TSMC withdrawal Huawei 5 nm allocation goes to AMD; My first inquiry is, does that truly mean 5 nm, or can this additional access be secured from 7 nm lines (probably not on booking) or 5 nm lithography adaption to 7 nm+. Reason is 5 nm carries a factor cost increase regardless of the design verification tasks. There are time, cost and risk factors moving to new node before anticipated.

I suspect for Epyc Milan, AMD and TSMC have qualified 5 nm for Milan. But what else and that takes effort, time and money.

AMD is primarily a process competitor and opportunity to advance one node is certainly compelling. More so AMD needs wafer starts especially if up to 35% of the production revenue continues to be sacrificed as sales close. AMD needs those starts or AMD will not make its 2020 revenue objective. Supply vis-à-vis Intel has held AMD enterprise and constituent cluster back from capitalizing on better product that Intel, although, I am not so sure in server in relation Intel Scalable (work horse) kibble; even if Rome/Milan are sirloin and rib steak. It takes whole product and software stack and AMD has shown that ability essentially in some custom space.

You have to want AMD, and AMD takes extra effort to secure the advantages AMD is capable effectively utilized.

Intel on the other hand holding commercial, hyperscale and cloud with supply that is trusted good enough for the application and enterprise on the application Cores balanced sweet spot; 8 to 16. 61% of all Scalable volume is 8 to 16C. Which for AMD will take more than access to 5 nm process too compete. AMD needs and will gain some supply advantage.

In relation Scalable, 58% of all Rome is 8 to 24C. Or, 59% is 16 to 32C, where AMD like ARM 64 attempt to compete above Intel product rungs. Only 18% of Rome is 48/64C likely on applications development and perhaps infinity bus saturation seems that way for TR 3990X v TR 3970X, there are certain applications effected by bus saturation at 48/64C. If application can be containerized associated cores and cache more cores scale, if not, the massive multicores stall.

On price competition. I don't think AMD will be competitive with intel on cost : price for margin gain at 5 nm node on the factor cost increase of 5 nm and Intel's strategy to lag as cost optimizer.
Intel's on 10 nm now for 3 years. Xeon Ice lake risk production digital logic and SRAM and SRAM with processing logic for Aigilex 10 nm FPGA. Intel knows how to produce whatever 10 nm is. And will do so at a cost : price advantage verse AMD claiming process leadership position. Intel's factor cost increase, not that AMD does not share this, is interconnect and packaging. So Intel is exposed to factor costs too and if trailing on lithography optimizes for a design manufacturer on component subsystem cost averaging.

AMD needed the wafer starts and wasn't going to make 2020 revenue objective solely inheriting TSMC 7 nm access as Apple and Huawei left those lines. 5 nm makes it possible for AMD to secure needed supply for 2020 objective and how AMD manages the cost and risk of 5 nm is a worthwhile engineering design and production management task.

Sold 1k shares at $52.15 a few days ago, since the market is totally divorce of reality. Any suggestions for how to proceed? I saw the cities burning and thought the market was already too high. Get back on the train up? But for how long? Any insight is appreciated from the SeekingAlpha family.
Gordbuffett profile picture

If you do that, it’s almost a certainty that your intelligence will shine through.
DimaP123 profile picture
Media loves to exaggerate everything! A random burning car they will show at every possible angle like it was space alien attack.
You need to see what is moving the index. Since people are staying at home and depend on tech (laptops, streaming movies, games, etc) tech stocks will rise. SP500 is very heavy on tech stocks, not banks, not energy. As long as you stay at home, tech will outpace any other sector. When people come out from shelters then retails, banks, energy will start growing. Some tech is expected to slowdown, like ZM (I bet AAPL will keep growing no matter what). AMD has amazing outlook for the nearest future, selling it at 52 was too low. You sold it at the bottom of the range. I was buying at it at 53, sold all at 58. More likely will reload later.
Average Joe Investors carry no patient better to invest long term. They want a quick scheme to rich however they will miss the train because AMD should be worth over $100
With Fed's Unlimited Printing of US Dollars, the inflation of the money should be reflected into Stock market. Anything in Stock market jumps, including junk stocks, bankruptcy stocks
DimaP123 profile picture
they do not need to print money all the time, FEDs can use existing reserves.
It's very far from "unlimited" printing.
Considering the size of US economy, it's really small amount and
money velocity M2 has been decreasing last 13 years and steeply
decreased lately.

I understand it might cause general "asset" inflation but
total money supply is decreasing in main street and might cause
deflation actually.
Jim_Purzickis profile picture
linklinklink profile picture

Another pointless post.
What aren't you long.
The pants? I kid, I kid. We all need a bad joke, in these times of social distancing.
Disagree with this article? Submit your own. To report a factual error in this article, . Your feedback matters to us!

About AMD

SymbolLast Price% Chg
Market Cap
Yield (TTM)
Rev Growth (YoY)
Short Interest
Prev. Close
Compare to Peers

More on AMD

Related Stocks

SymbolLast Price% Chg
To ensure this doesn’t happen in the future, please enable Javascript and cookies in your browser.
Is this happening to you frequently? Please report it on our feedback forum.
If you have an ad-blocker enabled you may be blocked from proceeding. Please disable your ad-blocker and refresh.