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AMD Closes Below $8: Wall Street not Happy with Delays

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December 18, 2007 1:59:05 AM

http://money.cnn.com/news/newsfeeds/articles/newstex/AF...

Quote:
AMD hits year low on product delays
December 17, 2007: 07:23 PM EST


Dec. 17, 2007 (Thomson Financial delivered by Newstex) --

NEW YORK (AP) - Shares in microchip maker Advanced Micro Devices Inc. hit a year low Monday on continuing negative reaction to the company's analyst meeting last Thursday.

In a note to investors, Citi (NYSE:C) analyst Glen Yeung said his view of the company was confirmed at the meeting, in which AMD (NYSE:AMD) acknowledged delays in key products.

Yeung said AMD's problems opened an opportunity for competitor Intel Corp. (NASDAQ:INTC) to add market share in high-margin notebook and server chips.

He noted AMD raised its 2008 guidance above current analyst consensus and said the company's estimates were 'overly optimistic' and built on 'unrealistic assumptions.'
AMD, which has been hit by a series of delays in key products, acknowledged its shortcomings at the analyst meeting and said it aims to reach profitability in the second half of 2008 after losses in every quarter of 2007.

Its shares fell 48 cents, or 5.7 percent, to a 52-week low of $7.95 Monday. Shares had traded between $8.42 and $23 over the past year.


PS - I predicted this!
December 18, 2007 2:05:06 AM

Damn.

I guess AMD's ever rosy outlooks are starting to wear thin with analysts and investors. Tell me, when was the last time they actually met their financial forecast estimates? They always end up with some lame excuse for why the estimates were not met... and if they run out of excuses, Hector starts crying MONOPOLY!
December 18, 2007 2:05:42 AM

Ouch. I've actually watched the webcast, it wasn't pretty. I was also surprised at how little Hector knew about the company. If you watch the Q&A at the end, he couldn't even answer some financial questions (none of the technical, with obvious reason), which he handed to other members of the AMD staff.

R700 wasn't spoken about either, which makes sense since this was regarding their plans for 2008, but they did show updated roadmaps, which slotted the r700 in 2009.

Personally though, I think they will be closer to eliminating their quarterly losses for this time frame. The 3850/3870 has been a very hot seller, I expect it to make a dent in their aim for profitability. It won't bring them up a large amount, but should take off a chunk. I just hope r680 gets released soon, and before the 9800 series from Nvidia.
December 18, 2007 5:59:07 AM

Again, to play Devil's advocate -

The entire market took a huge nose dive, not just AMD. Sure, they dropped below $8, but Intel lost $.66 (normal and afterhours). The Dow Jones lost almost $173 and Nasdaq lost $61. AMD is looking worse, just cause of the condition and position it is in nowadays, but again, it wasn't just them that had a bad day, but pretty much everyone.
December 18, 2007 6:56:48 AM

In summary, since AMD only had a momentary setback, now is a great time to buy AMD stock if you're willing to hold onto it for more than a couple quarters.

Intel took a good lead with the Hi-K transistors, and AMD a setback with the bug, but soon their value will readjust unless someone swoops in and buys them.
a c 480 à CPUs
a c 122 À AMD
December 18, 2007 8:22:27 AM

I would say that AMD needs to re-focus their strategy back to basics. They should spin-off ATI as an independent company or look to someone who is willing to acquire them.

AMD is cutting R&D expenses and that means there is less money for both CPU & GPU development. By becoming a CPU company again, AMD can refocus their attention on their formerly primary business.

At this point they are loosing out to both Intel and nVidia. That's a two front war of attrition which AMD is likely to loose if nothing is done immediately.
December 18, 2007 9:39:30 AM

NMDante said:
Again, to play Devil's advocate -

The entire market took a huge nose dive, not just AMD. Sure, they dropped below $8, but Intel lost $.66 (normal and afterhours). The Dow Jones lost almost $173 and Nasdaq lost $61. AMD is looking worse, just cause of the condition and position it is in nowadays, but again, it wasn't just them that had a bad day, but pretty much everyone.



Don't even try to say that AMD is going down with the market! Don't compare dollar amounts between stocks and indices, compare percentages.

Here some FACTS for you:

AMD vs. DOW


AMD vs. INTC



The market has gone down a hair in three months.

Intel has gained a little in three months.

AMD HAS LOST 40% OF ITS VALUE IN THREE MONTHS. STOP BLAMING THE MARKETS.
a b à CPUs
December 18, 2007 10:20:01 AM


You might want to consider some medication ... it can help you through this sort of crisis TC.

We are here to support you.

It's going to be ok ...

:) 
a b à CPUs
December 18, 2007 10:55:47 AM

Reynod said:
You might want to consider some medication ... it can help you through this sort of crisis TC.

We are here to support you.

It's going to be ok ...

:) 


TC's right, and i ask my self "what products would i want to buy from ATi/AMD?" - the answer is none, and thats a problem... cause im sure there are thousands like me who want what i want... sorry AMD you have nothing, even the products you offer were offered too late.
December 18, 2007 11:04:52 AM

well if i had the money id invest a bit in them not to much. as they may go down altogether,

shari***spin: "AMD investors afraid just like the calm before the storm only it seems to be caused by the massive amounts of innovation and originality + intel killing performance and peff per watt in pre configured systems, there jumping ship like henri richards... which btw left due to AMD's idea's and innovations causing further heart problems. ZOMG AMD 4 LYF,"
December 18, 2007 11:12:52 AM

Reynod said:
You might want to consider some medication ... it can help you through this sort of crisis TC.


LOL. I'm not the one in crisis though, AMD is. I don't think some people on this board understand the seriousness of the situation. AMD has basically lost 40% of it's value since November, that is shocking and alarming.

I agree with others that there is the potential to gain a lot of money. If AMD gets back on its feet you could very easily double your money in a year. However, there is also a lot of risk. AMD is going to bleed at least until 4Q 2008, and may not even see the black until 2009.

Unlike the United States government (which has virtually unlimited and undisputed credit), AMD can only accumulate so much debt before creditors start saying "no". Once this happens AMD will no longer be able to pay its bills.

I think what needs to be done is a steady trend toward stability. If AMD can show shrinking quartly deficits that trend toward 1Q 2009 profitability you'll see investor confidence restored.

However, when 4Q numbers come out, I think a lot of you will be surprised at another 300M+ loss.
December 18, 2007 12:12:24 PM

Samsung, Google, Nvidia, Bob Dole.... Anyone!!! Please save AMD by buying them out!!!
December 18, 2007 12:45:18 PM

^^ Intel? :p 



I'm planning on buying in to AMD eventually. I think they're important enough in the industry to be a good investment to someone whose willing to fork out the dough to buy them and turn them around.
December 18, 2007 12:54:10 PM

I'm going to buy AMD stock. It will be a good adition to my portfolio of Enron and Worldcom. :) 
December 18, 2007 1:12:40 PM

I think it would be interesting for Samsung to invest in AMD. They could definitely turn AMD around. I don't have a single Samsung product that I am displeased with
December 18, 2007 1:13:24 PM

Yeah you also should switch to Betamax too!
December 18, 2007 1:22:04 PM

It must have been Hectors raise that caused it to drop..... :oops: . o O (Oh.. nm)
December 18, 2007 1:25:05 PM

I am going to wait til after christmas and purchase about 10 shares myself.
December 18, 2007 1:43:34 PM

bfellow said:
Yeah you also should switch to Betamax too!


Can't, Im still saving up to buy The Jim Nabors Collection on 8-track tapes. :pt1cable: 
December 18, 2007 1:45:06 PM

Well I'm no financial expert, but wouldn't AMD's current debt be a big disincentive for somebody to buy them? Whoever buys them out will become the new owner of all that debt, which I've lost track of (a few billion here, a few billion there). I've heard of the term "poison pill", which I've always thought referred to the practice of a company loading up on debt to avoid a hostile takeover. AMD did not take on that debt to avoid a takeover. They did it to acquire ATI and to have enough operating cash just to stay alive, but the end result would be the same as poison pill. As I said, I'm no financial expert, so that could be something else entirely.
December 18, 2007 1:49:19 PM

Now, I don't think much of Mr. Ruiz, but I will say that his handing off questions doesn't actually necessarily mean he doesn't know the answers to the questions. Before conferences like these, the parties involved will always have a list of prepared questions they think will be asked and canned responses well phrased as answers. Each person has a small set of these. So when he hands off a question to someone else, either A.) He doesn't know the answer (although rare) or B.) Another person has a response that they agreed was the best earlier.
December 18, 2007 2:01:21 PM

So an idiot analyst who has probably never seen a PC assembly line much less a clean room can CRY "UNREALISTIC ASSUMPTIONS" with no explanation while ths company who is currently providing nearly 1/4 of the world's X86 CPUs can't miss the slightest trick?

A good example is the fact that VMWare is pleasing the stock market and MS is behind but they are not losing market cap like weight from a crack head. And as we know for MS within 3 months is "on-time."

ALL HAIL THE DUOPOLY!!!

Because I said so.
December 18, 2007 2:03:01 PM

BTW, Hector DIDN'T GET A RAISE. People misread an SEC filing and ran off with more doom and gloom.

God, you all DESERVE to be corporate slaves.
December 18, 2007 2:06:26 PM

back in 2001, just after 9/11, amd hit a low like this (duh...was 9/11! everyone went low...but amd was right around where it is now.). i'd been saving up for an enthusiast build, but instead i bought 100 shares of the little green guys. sit....wait....
athlon 64 dropped, press went wild, i sold out at ridiculous profits (definitely could afford that enthusiast build, not to mention a couple budget builds for friends!). waiting filled...
now, amd is down not because of 9/11, but because of its own internal terrorism. i'd be hesitant to buy again.

i confess, this has nothing to add to the thread. but all of this stock talk got me misty over the days when amd was a sound investment.

for the record, not taking sides in the whole blue vs. green debate. thats like getting into republicans vs. democrats...its a fake issue, a distraction from the real problems...
the only war we need to worry about is consumers vs. pricing. with amd crippled, they have to charge waaay too much. with intel reigning, they can charge whatever they want.
so please...no more blue vs. green. how about us vs. bluegreen....
December 18, 2007 2:16:17 PM

for the record, not taking sides in the whole blue vs. green debate. thats like getting into republicans vs. democrats...its a fake issue, a distraction from the real problems...
the only war we need to worry about is consumers vs. pricing. with amd crippled, they have to charge waaay too much. with intel reigning, they can charge whatever they want.
so please...no more blue vs. green. how about us vs. bluegreen....



If only it were that simple.
December 18, 2007 2:36:58 PM

BaronMatrix said:
So an idiot analyst who has probably never seen a PC assembly line much less a clean room can CRY "UNREALISTIC ASSUMPTIONS" with no explanation while ths company who is currently providing nearly 1/4 of the world's X86 CPUs can't miss the slightest trick?

A good example is the fact that VMWare is pleasing the stock market and MS is behind but they are not losing market cap like weight from a crack head. And as we know for MS within 3 months is "on-time."

ALL HAIL THE DUOPOLY!!!

Because I said so.


Quote:
BTW, Hector DIDN'T GET A RAISE. People misread an SEC filing and ran off with more doom and gloom.

God, you all DESERVE to be corporate slaves.


You are absolutely right about Hector not getting a raise!

There is a reason why AMD can not miss a slightest trick.... This is, if they fail with any one product, they do not have the cash to keep the company afloat. If a product fails, they will be in to much debt and have a great chance of going belly up. They recently had at least 3 products fail. They are fixing the CPU part and this should be a great fix and deliver the speed, dependability, and overclockability that we want so bad. The video card market they are screwed on because NVIDIA keeps turning up the heat by releasing faster and faster products. The X2900 and HD3800 lines are just so so cards. They are not top of the line when compared to the 8800 GT/GTS(G92)/GTX/Ultra.

But, what is keeping AMD/ATi such an attractive buy is the price. As Baron mentioned in another thread, they just dropped the price of their quad cores. Their video card market is very inexpensive and you get a decent amount of bang for you buck.

But the issue is still that their launches of those products I listed went far from stellar. With there current company value (Close if not under the 5 billion mark. ~Market Cap: 4.42B) and stock price (under $8.00 (7.96 or so) at 11:37 12-18-07 EST), this is a perfect time to buy them up. I only hope someone does so they can inject AMDTi with what they need. Hard Cold Cash! Read what THG has to say about AMD's situation and who they think may buy them out, it is very interesting.

Also, a certain amount of debt is good. You can use it as a tax write-off.

This thread was not aimed to pull down anyone, but just give my point of view on this and maybe show someone who is reading this another point of view. Please correct me if I am wrong in any area of my post because I want to learn what is correct (as in facts).
December 18, 2007 2:39:58 PM

heh...yeah....forgot. i hoped for logic and reason from people again....gotta remember not to do that anymore.
December 18, 2007 2:40:14 PM

TechnologyCoordinator said:
http://money.cnn.com/news/newsfeeds/articles/newstex/AF...

Quote:
AMD hits year low on product delays
December 17, 2007: 07:23 PM EST


Dec. 17, 2007 (Thomson Financial delivered by Newstex) --

NEW YORK (AP) - Shares in microchip maker Advanced Micro Devices Inc. hit a year low Monday on continuing negative reaction to the company's analyst meeting last Thursday.

In a note to investors, Citi (NYSE:C) analyst Glen Yeung said his view of the company was confirmed at the meeting, in which AMD (NYSE:AMD) acknowledged delays in key products.

Yeung said AMD's problems opened an opportunity for competitor Intel Corp. (NASDAQ:INTC) to add market share in high-margin notebook and server chips.

He noted AMD raised its 2008 guidance above current analyst consensus and said the company's estimates were 'overly optimistic' and built on 'unrealistic assumptions.'
AMD, which has been hit by a series of delays in key products, acknowledged its shortcomings at the analyst meeting and said it aims to reach profitability in the second half of 2008 after losses in every quarter of 2007.

Its shares fell 48 cents, or 5.7 percent, to a 52-week low of $7.95 Monday. Shares had traded between $8.42 and $23 over the past year.


PS - I predicted this!


TC you seem to be enjoying AMD's peril. Your not trying to subdue the share price a little further to make a hostile bid are you?
December 18, 2007 2:41:57 PM

TC is just about to become owner of AMD!
December 18, 2007 2:45:21 PM

I wouldn't be surprised in the least if Intel ponied up some money to buy into AMD, similar to what M$ did for Apple back in the 90s.


At the same time, AMD needs to let ATi go. Let a company like Matrox buy 'em. They may not be as well known these days, but they are still a company who builds video cards. ATi would certainly fill in gaps they once tried to pursue.
December 18, 2007 2:55:08 PM

what? I think ati is amd's cash cow at the mo - source of strong revenue that is:

http://www.fudzilla.com/index.php?option=com_content&ta...

From a u.k. perspective 3870s are hard to find yes indeedy so im guessing demand is strong. Novatech.co.uk had 17 last wednesday, scabby 'novatech' branded ones with no games in the bundle, all gone in 48 hours. Novatechs a sizeable firm im sure, but its not our equivalent of newegg, so a few of those 17 lucky ones must have been trawling the internet looking for whatever they could get their hands on.

p.s. must have had a new batch, cos theyve got 1 left as of now. 162 quid.
December 18, 2007 2:56:45 PM

Quote:
DELETED


Put your handbag away sweetheart, and no scratching or pulling hair either. :lol: 
December 18, 2007 3:17:34 PM

TSIMonster said:
I think it would be interesting for Samsung to invest in AMD. They could definitely turn AMD around. I don't have a single Samsung product that I am displeased with

If AMD "must" be bought out, I rather have it be ANY American company (maybe Canada for ATIs sake).
Then when Intel goes to fry Samsung for example, they won't be killing another American company.

Actually, thinking I will like HP to buy AMD, for the spirit of the OLD HP. HP was a powerhouse R&D company in Silicon Valley, not like what they are now.

But still, I rather see AMD stay alive than having anyone buy them out.
December 18, 2007 3:35:21 PM

blueeyesm said:
At the same time, AMD needs to let ATi go. Let a company like Matrox buy 'em. They may not be as well known these days, but they are still a company who builds video cards. ATi would certainly fill in gaps they once tried to pursue.


Bad Idea. Actually that would really be AMDs end. Buying a decent GPU company, dragging it down close to ruin and then selling it for a single $? I can't imagine what the shareholders would do, but probably something that was more common in the 15th century and involves torches and pitch forks...
You have to remember why AMD bought ATI. Not because they make high end GPUs or because they sport a fancy red color, but because they make chipsets and onboard video solutions. With that AMD can finally offer a whole platform - that's where the money is.
The only problem is, offering a decent platform isn't enough if you got a single sucker inbetween.
December 18, 2007 3:46:50 PM

I forgot about the other company. Google. And the strange thing is, I saw the title to the new time magazine or something of another that says they are trying to build the ultimate pc, or something of that sort. Maybe they would be interested?
December 18, 2007 3:47:29 PM

BaronMatrix said:
BTW, Hector DIDN'T GET A RAISE. People misread an SEC filing and ran off with more doom and gloom.

God, you all DESERVE to be corporate slaves.


Well.... exCUUUUSSSSSSEE MEEEEEEeeeeeeah. :lol: 

Corporate slaves... :kaola:  . o O (Guess it takes one.. to know one.)
December 18, 2007 3:59:09 PM

TechnologyCoordinator said:
LOL. I'm not the one in crisis though, AMD is. I don't think some people on this board understand the seriousness of the situation. AMD has basically lost 40% of it's value since November, that is shocking and alarming.

I agree with others that there is the potential to gain a lot of money. If AMD gets back on its feet you could very easily double your money in a year. However, there is also a lot of risk. AMD is going to bleed at least until 4Q 2008, and may not even see the black until 2009.

Unlike the United States government (which has virtually unlimited and undisputed credit), AMD can only accumulate so much debt before creditors start saying "no". Once this happens AMD will no longer be able to pay its bills.

I think what needs to be done is a steady trend toward stability. If AMD can show shrinking quartly deficits that trend toward 1Q 2009 profitability you'll see investor confidence restored.

However, when 4Q numbers come out, I think a lot of you will be surprised at another 300M+ loss.




True that's a bad thing but only if you want to sell. It's a great thing if you want to buy. I don't think the losses will be that high because of ATi revenue. That division should be VERY close to the black. And the Toshiba numbers should have a positive effect.


I'm sorry but I have to look at the glass as half full. And BTW, I'm more upset about this than Hector.

You corporate slaves.
December 18, 2007 4:00:18 PM

TSIMonster said:
I think it would be interesting for Samsung to invest in AMD. They could definitely turn AMD around. I don't have a single Samsung product that I am displeased with



Funny, I don't have AMD product I am displeased with. I have three systems and all are blazing.
December 18, 2007 4:07:00 PM

Quote:
DELETED


I'm sorry, did I hurt AMDs feelings? Poor AMD. Perhaps if we pray to Hector our processors will be faster.

Hate to break it to you, but ANYONE that posts on here is a total dorkmeister. If you're not interested in the topic, then don't read and don't reply. There seems to be plenty of other people who would like to discuss and speculate about it.
December 18, 2007 4:11:45 PM

TechnologyCoordinator said:
I'm sorry, did I hurt AMDs feelings? Poor AMD. Perhaps if we pray to Hector our processors will be faster.

Hate to break it to you, but ANYONE that posts on here is a total dorkmeister. If you're not interested in the topic, then don't read and don't reply. There seems to be plenty of other people who would like to discuss and speculate about it.


He's right you know, were all pretty sad :lol: 

But TC you are starting to sound a bit like the news guy from "V for Vendetta" or someone from Fox news in a relentless propoganda type way. Do stop banging on, theres a good chap.
December 18, 2007 4:14:59 PM

jaguarskx said:
I would say that AMD needs to re-focus their strategy back to backs. They should spin-off ATI as an independent company or look to someone who is willing to acquire them.

AMD is cutting R&D expenses and that means there is less money for both CPU & GPU development. By becoming a CPU company again, AMD can refocus their attention on their formerly primary business.

At this point they are loosing out to both Intel and nVidia. That's a two front war of attrition which AMD is likely to loose if nothing is done immediately.


I suggested selling the ATI division in a different thread and got shot down for it. Good to see someone else thinks its a good idea.

As to who might buy AMD, what about Warren Buffett? He's got enough billions around that he could buy AMD, its debt, and sink a ton of money into R&D without batting an eyelash. He could also hire some decent people to run the company like a business and find a way to make good products that sell, thereby earning profits as well.
December 18, 2007 4:16:36 PM

BaronMatrix said:
True that's a bad thing but only if you want to sell. It's a great thing if you want to buy. I don't think the losses will be that high because of ATi revenue. That division should be VERY close to the black. And the Toshiba numbers should have a positive effect.


I'm sorry but I have to look at the glass as half full. And BTW, I'm more upset about this than Hector.

You corporate slaves.



Well, just like Q3, we'll have to wait and see if I and others will be right again in Q4.

I see the glass as 9/10 empty, you see it as 1/10 full, LOL jkjk.

I don't get the corporate slave thing though, but it sounds new and exciting, where do I sign up?





BaronMatrix said:
I have three systems and all are blazing.


Too bad you never got that Quad FX system, it would be blazing too!

(Sorry, couldn't resist)
December 18, 2007 4:45:30 PM

Now that the 7's are here, I wonder how long it will be until AMD hits the 6's? Not trying to be too much doom and gloom, but rather trying to guess when to buy back in.
December 18, 2007 4:47:14 PM

sailer said:
Now that the 7's are here, I wonder how long it will be until AMD hits the 6's? Not trying to be too much doom and gloom, but rather trying to guess when to buy back in.


I do not predict trading in the 6's until the Q4 earnings statement. If it's bad, hello low 6's.


If you think that AMD has a chance to return to profitability, BUY NOW. I don't have spare cash nor am I willing to take a risk on AMD at this point.
December 18, 2007 4:56:01 PM

I fully expect that Q4 07 is going to be bad, what with the write off from ATI going into it and the Phenom problems and subsequent recall/stop shipment in place. I've got a bit of spare cash, but I've also watched my stock portfolio drop over $15,000 in the past few months, so I don't want to needlessly throw money to the wind.
December 18, 2007 5:01:02 PM

I'd have thought it was looking up a little for Q4...
3850/3870 released to high acclaim, previews of dual/tri/quad-crossfire, 790X/FX out. Phenom will obviously not be as expected, but it depends how many sell with the price reduction....
I'm not saying it'll be great, but I wouldn't bet against this quarter...
December 18, 2007 5:01:46 PM

Wow... I think that this is the first thread that I have read that TC and BarronMatrix are not at each other throats!

Are you two feeling ok?

Actually, I quite like it. It seems like everyone here has made great points, other then MrsBytch (who probably just upset because she broke another nail, or for fact is the one who is lonely sitting in front of her computer with no one there to spend time with like she pointed out us dorkmeisters all are. Also... whatever a dorkmeister is... I guess it takes one to know one. Welcome to the group! We have jackets!).
December 18, 2007 5:09:21 PM

Must be the holidays affect... Tis the Season to be jolly.
December 18, 2007 5:37:41 PM

AMD is a big company and to do so many dumb things in this short time is odd. Could this however be a brilliant move for a stock buy back so they can go private? Think if they went to IBM and got a loan for 2 billion to buy all their stock up.
December 18, 2007 5:46:21 PM

spaztic7 said:
Wow... I think that this is the first thread that I have read that TC and BarronMatrix are not at each other throats!


LOL. I like the civil disagreement, it's much more.... CIVIL!

Bytch is just trying to bait me into going after him/her, and I won't let it work :D 
!